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

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

Current account of BOP records transactions is relating to ______.

1. exchange of goods.
2. exchange of services.
3. unilateral transfers.
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.

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

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

Foreign exchange transactions which are independent of other transactions in the Balance of Payments Account are called: (Choose the correct alternative)

1. Current transactions.
2. Capital transactions.
3. Autonomous transactions.
4. Accommodating transactions.

________ is a systematic record of all the economic transactions between one country and rest of the world.

1. Balance of trade.
2. Balance of transactions.
3. Budget.
4. Balance of payments.

What will be the effect of appreciation of domestic currency?

1. Imports will fall and exports will rise.
2. Both exports and imports will fall.
3. Imports will rise and exports will fall.
4. Both exports and imports will rise.

Match the following.

1	Visibles	(i)	Foreign investment and borrowing
2	Invisible	(ii)	Transportation and communication
3	Capital account	(iii)	Car and mobiles
4	Unilateral transfers	(iv)	Grants and donations

Codes: I II III IV

1. (ii) (i) (iii) (iv)
2. (iii) (ii) (i) (iv)
3. (iii) (iv) (ii) (i)
4. (i) (ii) (iii) (iv)

Buyers and sellers of foreign exchange are _______.

1. central banks.
2. commercial banks.
3. brokers.
4. all 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.