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.

Which exchange rate measures the average relative strength of a given currency with respect to other currencies without eliminating the effect of change in price?

1. Nominal exchange rate.
2. Nominal effective exchange rate.
3. Real exchange rate.
4. Real effective exchange rate.

Government transactions include _______ to keep the BOP in balance and which are not carried out for profits.

1. borrowings from IMF and other financial institutions
2. grants and donations
3. foreign exchange reserve
4. Both (a) and (C)

Balance of Payments deficit is calculated by taking into account the _______ only.

1. accommodating transactions
2. autonomous transactions
3. unilateral transactions
4. None of the above

________ involves transactions related to transfers of assets and liabilities in BoP account.

1. Balance of trade account
2. Current account
3. Unilateral transfer account
4. Capital account

Foreign exchange is demanded by _______.

1. domestic residents to purchase goods and services from other countries.
2. sending gifts and grants to foreign countries (abroad).
3. the domestic residents to purchase financial assets in a particular country.
4. all of them.

When one country manipulates exchange rate against the interest of other country, is known as ________.

1. managed floating.
2. dirty floating.
3. wide band.
4. crawling peg.

Current transactions are of _______ nature.

1. flow.
2. stock.
3. both flow and stock.
4. none of the above.

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

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