In case of currency appreciation, the domestic currency becomes _______.

1. less valuable.
2. more valuable.
3. rise.
4. fall.

If India exports goods worth 20 crore and imports goods worth 30 crore, it will have a _________.

1. surplus of ₹ 10 crore in balance of trade.
2. deficit of ₹ 10 crore in balance of trade.
3. deficit of ₹ 50 crore in balance of trade.
4. can't say.

Which of the following international agency manage foreign exchange rate system in the world?

1. Central Bank.
2. IMF.
3. World Bank.
4. All of these.

Which is not a feature of Balance of Payments (BOP) Account?

1. It includes economic transactions.
2. It has given period of time.
3. It records only capital transactions.
4. Trade between resident of a country and rest of the world.

The supply of foreign exchange comes from ________.

1. the foreigners purchasing home country's goods and services through exports.
2. the foreigners who invest in home country through joint ventures or through financial market operations.
3. currency dealers and speculators.
4. all of them.

Balance of Payments ‘deficit’ is the excess of:

1. Current account payments over current account receipts.
2. Capital account payments over capital account receipts.
3. Autonomous payments over autonomous receipts.
4. Accommodating payments over a accommodating receipts.

What will be the effect on exports if foreign exchange rate increases?

1. Increases.
2. Decreases.
3. Remains constant.
4. None of them.

Other things remaining the same, when in a country the market price of foreign currency falls, national income is likely: (Choose the correct alternative)

1. To rise.
2. To fall.
3. To rise or to fall.
4. To remain unaffected.

If the price of 1 USS has fallen from ₹ 56 to ₹ 52, the Indian currency has:

1. Depreciated.
2. Appreciated.
3. Devalued.
4. None.

Reduction in the value of domestic currency by the government is called ______.

1. depreciation.
2. revaluation.
3. devaluation.
4. appreciation.