Week 14 — Quiz · Open-Economy Macro: Exchange Rates & the Balance of Payments

Course: Principles of Macroeconomics (ECON 2) · Silver Oak University (fictional sample) · Prof. Ashford
Objective 8 · 10 questions · 10 points · closed to AI · one attempt
Auto-graded (Classic QTI): see F-quiz-week-14-qti.xml for the Canvas import. Every numeric answer is pre-computed; every appreciation/depreciation and CA/FA claim is verified.

The questions (human-readable; answer key below)

Q1. The exchange rate moves from $1 = ¥100 to $1 = ¥120. The dollar has —
A) Appreciated — one dollar now buys MORE yen than before B) Depreciated — one dollar now buys FEWER yen than before C) Stayed exactly the same in value D) Been devalued by the Japanese government

Q2. A student says: "$1 = ¥120 is a bigger number than $1 = ¥100, so the dollar must have gotten WEAKER." This reasoning is —
A) Correct — bigger yen-per-dollar numbers always mean a weaker dollar B) Incorrect — a bigger yen-per-dollar number means the dollar buys MORE yen, which is a STRONGER (appreciated) dollar C) Correct, but only when the Federal Reserve confirms it D) Impossible to evaluate without more information

Q3. Using the appreciation from $1 = ¥100 to $1 = ¥120: a $25,000 American car sold in Japan changes in price from —
A) ¥2,500,000 to ¥3,000,000 — pricier for the Japanese buyer B) ¥3,000,000 to ¥2,500,000 — cheaper for the Japanese buyer C) $25,000 to $30,000 — the dollar price itself rises D) No change, since the car's dollar price is fixed

Q4. Using that SAME appreciation ($1=¥100 → $1=¥120): a ¥1,200,000 Japanese machine sold in the U.S. changes in price from —
A) $10,000 to $12,000 — pricier for the U.S. buyer B) $12,000 to $10,000 — cheaper for the U.S. buyer C) ¥1,200,000 to ¥1,440,000 — the yen price itself rises D) No change, since the machine's yen price is fixed

Q5. Combining Q3 and Q4: when the dollar appreciates, U.S. exports tend to ___ and U.S. imports tend to , so net exports (NX) tend to .
A) Rise / rise / rise B) Fall / rise / fall C) Rise / fall / rise D) Fall / fall / stay the same

Q6. If instead the exchange rate moved from $1 = ¥100 to $1 = ¥80 (the dollar DEPRECIATES), what happens to U.S. exports and imports?
A) Exports rise (U.S. goods get cheaper abroad); imports fall (foreign goods get pricier at home); NX rises B) Exports fall; imports rise; NX falls — the same as appreciation C) Both exports and imports rise together D) Neither exports nor imports are affected by depreciation

Q7. (Select all that apply.) Which of the following are TRUE effects of an appreciated ("strong") U.S. dollar?
☑ A) Imported goods become cheaper for U.S. consumers ☑ B) U.S. exports become pricier for foreign buyers ☐ C) It is unambiguously good news for every sector of the U.S. economy ☑ D) Traveling abroad becomes cheaper for U.S. tourists ☐ E) U.S. export-sector workers face no change in demand for their goods

Q8. (True/False) At the principles level, a country's current-account balance and its financial-account balance are mirror images that sum to zero (e.g., a current-account balance of −50 pairs with a financial-account balance of +50). → True

Q9. (Matching) Appreciation → A currency buys MORE of another currency than before; Depreciation → A currency buys LESS of another currency than before; Current account (CA) → Mostly net exports (exports minus imports), plus smaller income/transfer flows; Financial account (FA) → The flow of financial investment into and out of the country.

Q10. A country's financial-account balance is +80 (a $80B surplus). What is its current-account balance?
A) −80 — a $80B current-account deficit B) +80 — the same as the financial account C) 0 — the accounts are unrelated D) Cannot be determined from the information given

Answer key & feedback (instructor)

Quantitative gate: PASS — every numeric answer re-computed: Q3 $25,000×100=¥2,500,000 and $25,000×120=¥3,000,000; Q4 ¥1,200,000÷100=$12,000 and ¥1,200,000÷120=$10,000; Q10 CA = −(+80) = −80.
Graph-logic check: PASS — every direction claim verified against the NUMBERS_PACK canon: Q1/Q2 ¥120>¥100 = appreciation (never flipped); Q3 exports pricier abroad under appreciation; Q4 imports cheaper at home under appreciation; Q5 NX falls under appreciation; Q6 every arrow reversed under depreciation (NX rises); Q8/Q9/Q10 CA and FA are mirror images (CA + FA = 0), never treated as independent or moving in the same direction.

Quality gate (self-checked): every single-answer item has exactly one correct option; distractors target the named traps (flipped appreciation/depreciation direction, reversed export/import price effect, appreciation treated as a one-sided "good news" verdict, CA/FA treated as independent rather than mirrored). No free numeric entry; no essay.