The government of a country that is experiencing strong currency appreciation might find itself under pressure from some of its own citizens. Who would be likely to be bringing pressure and why?
What will be an ideal response?
A country experiencing strong currency appreciation will find that as a result imports are relatively cheaper but it may be more difficult to sell abroad. As a result, domestic manufacturers who sell abroad or who compete with imports will want the government to intervene in the foreign exchange market to slow the appreciation.
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Lily has $10 to spend each week on fish and chicken. Fish costs $2 a serving and chicken costs $3 a serving. The table shows Lily's marginal utilities of fish and chicken. Lily will consume ________ servings of chicken and ________ of fish each week
A) 4; 0 B) 1; 3 C) 0; 5 D) 2; 2
A recession normally causes ________ in government net tax revenues, ________ the budget deficit is an example of ________ automatic stabilization
A) an increase, increasing, the working of B) an increase, decreasing, a failure of C) a decrease, decreasing, the working of D) a decrease, increasing, a failure of E) a decrease, increasing, the working of
Holding other factors constant, the increase in African Americans and Hispanics in the labor force in the United States has
A) decreased structural and frictional unemployment. B) increased cyclical unemployment declined. C) decreased cyclical unemployment increased. D) increased the natural rate of unemployment.
A hedge is
A) a financial strategy that reduces the change of suffering losses arising from foreign exchange risk. B) an exchange rate arrangement in which a country pegs the value of its currency to the exchange value. C) the possibility that changes in the value of a nation's currency will result in variations in the market value of assets. D) active management of a floating exchange rate on the part of a country's government.