Which one of the following statements is the most accurate?

A. Appreciation is a fall in E when the exchange rate is fixed while revaluation is a fall in E when the exchange rate is flexible.
B. Appreciation is a fall in E when the exchange rate floats while revaluation is a fall in E when the exchange rate is fixed.
C. Appreciation is a rise in E when the exchange rate floats while revaluation is a fall in E when the exchange rate is fixed.
D. Appreciation is a fall in E when the exchange rate floats while revaluation is a rise in E when the exchange rate is fixed.


Answer: B. Appreciation is a fall in E when the exchange rate floats while revaluation is a fall in E when the exchange rate is fixed.

Economics

You might also like to view...

The fact that a firm is using a capital-intensive method of production means that input substitution is not possible

Indicate whether the statement is true or false

Economics

Increasing transactions costs of selling an asset make the asset

A) more valuable. B) more liquid. C) less liquid. D) more moneylike.

Economics

Union membership in the United States has remained relatively steady since 1955

a. True b. False

Economics

The fictional country of Alpetra increases the income tax rate so that tax revenues increase by $30 million. In response, consumption falls by $8 million. If GDP and government spending remains the same and Alpetra is a closed economy, what is the change in investment?

a. Investment increases by $8 million. b. Investment decreases by $8 million. c. Investment increases by $38 million. d. Investment decreases by $22 million.

Economics