AP Macroeconomics 💶
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Multiple Choice Practice for Open Economy-International Trade and Finance
Welcome to Unit 6 AP Macroeconomics Multiple Choice Questions! Grab some paper and a pencil 📄 to record your answers as you go. You can see how you did on the Unit 6 Practice Questions Answers and Review sheet once you're done. Don't worry, we have tons of resources available if you get stumped 😕 on a question. And if solo study is not your thing, join a group in Hours!
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Facts about the test: The AP Macroeconomics exam has 70 multiple choice questions and you will be given 1 hour to complete the section. That means it should take you around 8 minutes to complete 10 questions.
*The following questions were not written by College Board and, although they cover information outlined in the AP Macroeconomics Course and Exam Description, the formatting on the exam may be different.
1. When a country has a trade deficit . . .
A. the value of the country's imports exceeds the value of its exports
B. the supply exceeds demand
C. monetary policy exceeds fiscal policy
D. unemployment exceeds inflation rate
2. This records the value of exports and imports of both goods and services and international transfers of capital.
A. fiscal account
B. deficit account
C. government spending account
D. current account
3. This records the net flow of investment transactions into an economy.
A. discal account
B. deficit account
C. capital account
D. current account
4. This occurs when a currency becomes less valuable in terms of other currencies:
A. inflation
B. depreciation
C. depreciation
D. unemployment
5. If a nation's exports total $100,000 and its imports total $40,000, what is the nation's trade balance?
A. -$60,000
B. $60,000
C. $100,000
D. $140,000
6. If French investors purchase US bonds totaling $1 million, the purchase would be included in France's:
A. inflation rate
B. financial account
C. unemployment rate
D. open market operations
7. If fewer units of dollars are needed to buy a single unit of the other currency, this would have occured:
A. depreciation
B. investment
C. appreciation
D. fiscal policy
8. In the FOREX market, what type of relationship exists between the exchange rate and quantity demanded of a currency?
A. direct
B. inverse
C. exponential
D. none
9. What will occur if there is a surplus of dollars in the FOREX market?
A. unemployment
B. the exchange rate will rise
C. hyperinflation
D. the exchange rate will fall
10. A country's currency will usually appreciate if . . .
A. demand for the country's exports decreases
B. demand for the country's exports increases
C. demand for the country's exports disappears completely
D. trade ceases
11. If country J experiences higher inflation than country Oke over the course of a year, usually J's currency will:
A. increase relative to Oke's
B. appreciate relative to Oke's
C. depreciate relative to Oke's
D. decrease relative to Oke's
12. If the market determines a country's exchange rate, than that country has a:
A. negative exchange rate
B. fixed exchange rate
C. floating exchange rate
D. trade deficit
13. A tax on imports is known as a(n):
A. quota
B. appreciation
C. investment
D. tariff
14. A limit on the quantity of imports into a specific country is known as a(n):
A. quota
B. appreciation
C. investment
D. tariff
15. If the real interest rate in the US increases, foreign capital investment will:
A. decrease
B. increase
C. remain unchanged
D. not occur
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💸Unit 1 – Basic Economic Concepts
📈Unit 2 – Economic Indicators & the Business Cycle
💲Unit 3 – National Income & Price Determination
💰Unit 4 – Financial Sector
⚖️Unit 5 – Long-Run Consequences of Stabilization Policies
🏗Unit 6 – Open Economy - International Trade & Finance
📝Exam Skills: MCQ/FRQ
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