Combining the home money market and the uncovered interest parity relationship, we can see how changes in variables determine:

Suppose the current price of a pound of steak is $12 per pound and the equilibrium price is $9 per pound. In this case, there is a

A) surplus, so the price falls and quantity supplied increases. B) surplus, so the price rises and quantity demanded increases. C) shortage, so the price rises and quantity demanded decreases. D) shortage, so the price falls and quantity demanded increases. E) surplus, so the price falls and quantity demanded increases.

The U.S. supply curve of dollars is upward-sloping because a:

a. higher number of yen per dollar means Japanese goods are cheaper in Japan. b. higher number of yen per dollar means Japanese goods are cheaper in the U.S. c. lower number of yen per dollar means Japanese goods are cheaper in the U.S. d. none of these.