Reference no: EM133066444

1. Assume that bad weather in the U.S. destroys much of U.S. vegetable production and U.S. imports of Mexican vegetables increase as a result. This will

a. Increase the demand for pesos

b. Decrease the demand for pesos

c. Increase the supply of pesos

d. Decrease the supply of pesos

2. Which of the following will decrease the U.S. dollar-Mexican peso exchange rate (E$/peso) ?

a. An increase in U.S. GDP

b. An increase in the popularity of U.S. products in Mexico

c. Increased U.S. tourism in Mexico

d. None of the above

3. An increase in interest rates in Mexico will

a. Increase both the demand and supply of Mexican pesos

b. Decrease both the demand and supply of Mexican pesos

c. Increase the demand and decrease the supply of Mexican pesos

d. Decrease the demand and increase the supply of Mexican pesos

4. Consider the market to exchange U.S. dollars for Mexican pesos. If GM closes a factory in Ohio and builds a factory in Mexico

a. The demand for pesos will increase

b. The demand for pesos will decrease

c. The supply of pesos will increase

d. The supply of pesos will decrease