1. Many financial concepts taught in basic finance courses are actually culturally determined norms.

   a. true

   b. false

2. Ignoring transaction costs and based solely on the change in currency exchange rates, a speculator who sold short a three year contract for the Euro (receiving dollars) in January 1999 would have realized a profit upon the exercise of the contract in January 2002.

   a. true

   b. false

3. The 10 members that joined the European Union in May 2004 automatically assumed the euro as their national currency upon joining.

   a. true

   b. false

4. In general, as a country's income increases, so does the demand for imports.

   a. true

   b. false

5. In general, the United States goods trade balance has grown increasing positive over the last 3 years.

   a. true

   b. false

6. Consider the price elasticity of demand. If a product has price elasticity less than one it is considered to have relatively elastic demand.

   a. true

   b. false