Which of the following is an advantage of fixing exchange rates?
A. making the prices of foreign goods more flexible in the domestic market
B. making residents more mobile across countries
C. limiting foreign exchange risk
D. eliminating trade deficits
Answer: C
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Suppose Bank A holds $50,000 in deposits with other banks. In the balance sheet, this amount will be accounted as Bank A's:
A) cash equivalents. B) short-term borrowing. C) long-term investments. D) reserves.
For an individual LM curve, the money supply is assumed to
A) be constant. B) grow at a rate equal to the interest rate. C) grow at a rate equal to the growth rate in income. D) grow at a rate equal to the marginal propensity to consume.
Monopsony power is akin to an age-old proposition in economics that scarcity brings power, except in this case power is due to
a. scarce resources b. scarce input purchases c. scarce suppliers d. scarce purchasing time e. scarce product market
If taxation becomes more progressive, the built-in stability in the economy will increase.
Answer the following statement true (T) or false (F)