A pegged rate system that includes policy cooperation is usually:
A) difficult to maintain.
B) a good compromise for nations who want exchange rate stability, stable output, and some flexibility.
C) not a good bet for nations who are large trading partners.
D) administered by large private banks.
Ans: B) a good compromise for nations who want exchange rate stability, stable output, and some flexibility.
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What can one learn from the following figure?
What will be an ideal response?
According to the international trade theory, a country should import goods in which it has an absolute advantage
a. True b. False Indicate whether the statement is true or false
Is increased production of a good beneficial to society?
A. Yes, because scarcity is such an overriding concern. B. Yes, because more is always better. C. Maybe, it depends on what is foregone. D. No, because increased production does not increase utility.
Ceteris paribus, with a fixed exchange rate, if Americans decide to buy more Japanese-made television sets, this causes a market ________ of Japanese currency and creates a balance-of-payments ________ for the United States.
A. shortage; surplus B. surplus; surplus C. surplus; deficit D. shortage; deficit