Started on Friday, 8 A pril 2022, 7:07 PM
State Finished
C ompleted on Friday, 8 A pril 2022, 8:11 PM
Time taken 1 hour 4 mins
M arks 25.00/28.00
Grade 89.29 out of 100.00
Q u estion 1
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
Current account of the balance of payments year-end 2020
Item R (billions)
M erchandise exports 1 286
N et gold exports 108
Service receipts 121
Income receipts 122
M erchandise imports 1 109
Service payments 160
Income payments 216
Current transfers -44
Source: SARB Quarterly Bulletin (2021)
Based on the information above, the trade balance is....
a.
R285 billion.
b.
-R44 billion.
c.
,R160 billion.
d.
R1 286 billion.
Feedback
The trade balance is calculated as follows:
Trade balance = (merchandise exports + net gold exports) – merchandise imports
(R1 286 billion + R108 billion) – R1 109 billion = R285 billion
Q u estion 2
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
What could the central bank do to lessen the effect of the depreciating rand?
a.
supply more ZAR to the market
b.
decrease the domestic interest rate
c.
supply less USD to the market
d.
supply more USD to the market
Feedback
If the central bank supplies more dollars to the market, the supply of dollars will shift to
the right and the rand w ill appreciate. Carefully study section 4.3 in the textbook w hich
discusses the exchange rates. If the central bank supplies less USD to th e market, the
supply of dollars w ill shift to the left and the rand w ould depreciate. If the central bank
supplies more ZAR to the market, the supply curves of ZAR would shift to the right and
the rand w ill depreciate. If the domestic interest rate decreas es, it means that foreign
investors w ill rather invest elsewhere as they may be able to earn higher interest there,
and the supply of the USD w ill therefore decreases, illustrated by a leftw ard shift of the
, supply of dollars curve and thus a depreciation o f the rand. A decrease in the interest
rate level may not result in lessening the effect of a depreciating rand.
Q u estion 3
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
Which of the following figures show s the impact of an increase in USA interest rates on
the South A frican foreign exchange market?
a.
Figure 4
State Finished
C ompleted on Friday, 8 A pril 2022, 8:11 PM
Time taken 1 hour 4 mins
M arks 25.00/28.00
Grade 89.29 out of 100.00
Q u estion 1
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
Current account of the balance of payments year-end 2020
Item R (billions)
M erchandise exports 1 286
N et gold exports 108
Service receipts 121
Income receipts 122
M erchandise imports 1 109
Service payments 160
Income payments 216
Current transfers -44
Source: SARB Quarterly Bulletin (2021)
Based on the information above, the trade balance is....
a.
R285 billion.
b.
-R44 billion.
c.
,R160 billion.
d.
R1 286 billion.
Feedback
The trade balance is calculated as follows:
Trade balance = (merchandise exports + net gold exports) – merchandise imports
(R1 286 billion + R108 billion) – R1 109 billion = R285 billion
Q u estion 2
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
What could the central bank do to lessen the effect of the depreciating rand?
a.
supply more ZAR to the market
b.
decrease the domestic interest rate
c.
supply less USD to the market
d.
supply more USD to the market
Feedback
If the central bank supplies more dollars to the market, the supply of dollars will shift to
the right and the rand w ill appreciate. Carefully study section 4.3 in the textbook w hich
discusses the exchange rates. If the central bank supplies less USD to th e market, the
supply of dollars w ill shift to the left and the rand w ould depreciate. If the central bank
supplies more ZAR to the market, the supply curves of ZAR would shift to the right and
the rand w ill depreciate. If the domestic interest rate decreas es, it means that foreign
investors w ill rather invest elsewhere as they may be able to earn higher interest there,
and the supply of the USD w ill therefore decreases, illustrated by a leftw ard shift of the
, supply of dollars curve and thus a depreciation o f the rand. A decrease in the interest
rate level may not result in lessening the effect of a depreciating rand.
Q u estion 3
Correct
M ark 1.00 ou t of 1.00
Flag qu estion
Question text
Which of the following figures show s the impact of an increase in USA interest rates on
the South A frican foreign exchange market?
a.
Figure 4
