In the above figure, suppose the demand for dollars permanently decreases to D2. To maintain the target, the Fed
A) can buy dollars.
B) can sell dollars.
C) must decrease the nation's net exports.
D) cannot permanently maintain the exchange rate target of 150 yen per dollar.
D
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When Pepsi becomes more expensive relative to other beverages, people will purchase less Pepsi. This observation is known as the:
a. diamond-water paradox. b. law of diminishing marginal utility. c. substitution effect. d. income effect.
Potential output in an economy is dependent upon which of the following factors?
a. the given supply of resources b. rate of unemployment c. nominal wages d. potential output is not dependent on any of the previous factors
The income distribution of the United States is basically the nation's answer to the
A. WHAT question. B. FOR WHOM question. C. HOW question. D. WHAT, HOW, and FOR WHOM questions.
Which of the following statements is consistent with a decrease in supply?
A. There has been an advance in technology. B. Consumers' incomes have increased. C. The market price has decreased. D. Prices of raw material inputs have increased.