1. US FED Monetary policy has a direct impact on international finance because

a) if the FED adopts lower interest rate policies, the dollar tends to weaken and exports tend to rise

b) if the FED adopts lower interest rate policies, the dollar tends to strengthen and exports tend to fall

c) if the FED adopts lower interest rate policies, the dollar tends to strengthen and exports tend to rise

d) if the FED adopts higher interest rate policies, the dollar tends to weaken and exports tend to rise

2. If a firm has a debt-equity ratio of .45, long-term debt of $500, and equity of $2,000, then:

a. current liabilities must be $400.

b. current assets must be $400.

c. retained earnings must be $900.

d. preferred stock must be $400.