What are the potential benefits of a pegged currency system?
What will be an ideal response?
Some believe that fixed exchange rate systems bring with it policy discipline and stability. A fixed exchange rate should discourage over-expansionary fiscal or monetary policies, which would cause inflation and a loss of competitiveness under a fixed exchange rate system. Hence, fixed exchange rates should induce the kind of policies that help control inflation. The absence of day-to-day exchange rate volatility in such a system should eliminate the uncertainty that comes with floating exchange rates and which might hamper international trade. Note that the argument that exchange rate volatility hampers international trade is far from generally accepted. For example, it ignores the possibility to hedge currency fluctuations. Moreover, pegged exchange rate systems are not without risks, and may show considerable "latent variability," see Question 2 . Such devaluation risk also complicates international trade.
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A) strivers B) survivors C) experiencers D) makers E) believers
The current ratio
a. is generally smaller than the quick ratio. b. decreases when a company becomes more liquid. c. increases when a company allows more customers to charge on account instead of collecting cash. d. is larger when a company is more liquid.
Completed but unsold units for a manufacturing firm would be included in which of the following accounts?
a. Pending-Sale Inventory b. Finished Goods Inventory c. Work in Process Inventory d. Materials Inventory
Sequential activities hold just as much potential for resource conflicts as parallel activities.
Answer the following statement true (T) or false (F)