What is the difference between a target zone and a crawling peg?
What will be an ideal response?
In a target zone, the currency is allowed to fluctuate in a percentage band around a "central value." One can view a pegged system as a target zone system with a very narrow band. In a crawling peg system, the fixed rate or band is adjusted over time, typically in a pre-determined way as a function of the inflation differential between the crawling peg country and the country to whose currency the peg is set. Such a system is often used in developing countries, where the "crawl" of the band prevents the country from losing too much competitiveness when its inflation rate is higher than that of the benchmark country.
You might also like to view...
Errors in the ending inventory have a direct effect on net income for the period
a. True b. False Indicate whether the statement is true or false
At the molecular level, cells from different types of organisms vary in their tolerance to temperature and pH. This variation can mostly likely be attributed to
A. ability of the cells to form glucose polymers. B. replication of nucleic acids. C. the types of enzymes present in the cells. D. extent of saturation of fatty acids. E. ATP efficiency.
List four contextual forces affecting business communication. Explain one of the forces in detail
A negotiable instrument may be negotiated by
a. indorsement and delivery. b. delivery alone. c. either indorsement and delivery or delivery alone. d. none of these.