62. Consider the monetary transmission mechanism in an open economy. Other things being equal, an increase in the domestic money supply leads to a depreciation of the domestic currency, thereby inhibiting net exports and raising aggregate demand. an appreciation of the domestic currency, thereby inhibiting net exports and raising aggregate demand. an appreciation of the domestic currency, thereby stimulating net exports and reducing aggregate demand. an appreciation of the domestic currency, thereby stimulating net exports and raising aggregate demand. a depreciation of the domestic currency, thereby stimulating net exports and raising aggregate demand.

Consider a hypothetical open economy. The following table presents data on the relationship between various real interest rates and national saving, domestic investment, and net capital outflow in this economy, where the currency is the U.S. dollar. Assume that the economy is currently experiencing a balanced government budget.   Real Interest Rate National Saving Domestic Investment Net Capital Outflow (Percent) (Billions of dollars) (Billions of dollars) (Billions of dollars) 7 60 25 -10 6 55 30 -5 5 50 35 0 4 45 40 5 3 40 45 10 2 35 50 15     Given the information in the preceding table, use the blue points (circle symbol) to plot the demand for loanable funds. Next, use the orange points (square symbol) to plot the supply of loanable funds. Finally, use the black point (cross symbol) to indicate the equilibrium in this market.       On the following graph, plot the relationship between the real…

A U.S. company wants to buy its televisions from a Chinese company. The Chinese company sells its TVs for​ 1,200 yuan each. The current exchange rate between the U.S. dollar and the Chinese yuan is​ $1 = 6 yuan.   How many U.S. dollars will the U.S. company have to convert into yuan to pay for each​ television?   A. ​$1,200   B. ​$7,200   C. ​$200   D. ​$100

A. Canada produces natural resources (coal, natural gas, and others), the demand for which has increased rapidly as China and other emerging economies expand. i. Explain how growth in the demand for Canada's natural resources would affect the demand for Canadian dollars in the foreign exchange market. Explain how the supply of Canadian dollars would change. ii. iii. Explain how the value of the Canadian dollar would change. iv. Illustrate your answer with a graphical analysis. 1