Which of the following statements about the foreign exchange market is not true?
a. The exchange rate setting depends on the exchange rate regime a nation chooses.
b. When a central bank intervenes in the foreign exchange market, it also affects the nation's monetary base.
c. The elasticities of an economy's supply and demand for foreign exchange determine the exchange rate volatility.
d. Flexible exchange rates increase the business risks associated with exchange rate movements.
e. Fixed exchange rates decrease the business risks associated with changes in a nation's money supply.
.E
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Which of following is not an important category of bias in human decision making?
A. Temptation. B. Limited processing power. C. Reluctance to change. D. Single-mindedness.
The supply curve is believed to bend backward at high wage rates because
a. income effects outweigh substitution effects. b. substitution effects outweigh income effects. c. the income and substitution effects work together to create the backward bend. d. leisure time is less attractive.
Today there is a clear consensus about the best way to design a central bank. What are the criteria for a successful central bank?
What will be an ideal response?
Anything of value owned by a person or a firm is
A) an asset. B) a liability. C) wealth. D) owner's yield.