The use of foreign exchange reserves to keep exchange rates constant over time is called
A) a fixed exchange rate system.
B) the Bretton Woods system.
C) a fiscal fix.
D) a floating exchange rate system.
A
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Exhibit 30-1
?
A. social failure. B. optimal failure. C. market failure. D. socially optimal output. E. none of the above
China chooses to have ________ and ________ and therefore, cannot have free capital mobility at the same time
A) a fixed exchange rate; no control of monetary policy B) a fixed exchange rate; an independent monetary policy C) a flexible exchange rate; an independent monetary policy D) a flexible exchange rate; no control of monetary policy
If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.
If the elasticity number (E) is less than 1, a price increase will cause total revenue to fall.
Answer the following statement true (T) or false (F)