If the Fed desired to fix the euro/dollar exchange rate, they would have to:
A. maintain ample reserves of dollars.
B. be willing to exchange dollars for euros whenever anyone asked.
C. impose capital controls.
D. get the European Central Bank to also agree to fixed exchange rates.
Answer: B
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Which of the following claims is most likely to suffer from reverse causality?
A) Higher income increases consumption. B) Relatively wealthy people tend to be relatively healthy. C) More hours of study is likely to lead to better results. D) Crime rate is seen to be lower in countries having a higher level of poverty.
The impact of monetary policy on the exchange rate is emphasized by
A) supply-side economists. B) Monetarists. C) Keynesians. D) rational expectations theorists.
According to the Thomas (1954) analysis, American investment in industrial physical capital was
(a) labor-using in upswings of immigration. (b) labor-saving in upswings of immigration. (c) "labor neutral" over the course of immigration. (d) relentlessly labor-saving no matter what.
One problem with the European Union’s choice regarding equality versus efficiency is that it may inadvertently shrink the size of its “economic pie.”
Answer the following statement true (T) or false (F)