A . What action would a government take to keep its exchange rate from rising if demand for its currency increases? b. Why would a government want to keep its exchange rate from rising?
a . It would supply enough of its own currency to the foreign exchange market to counter the increase in
demand. This would keep the exchange rate from rising beyond a predetermined acceptable upper
limit.
b. In order to avoid the uncertainty introduced into international trade when exchange rates fluctuate, a
government would want to keep its exchange rate from rising.
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A transfer payment is a payment by the government to an individual
A) for an investment good. B) for which the government does not receive a good or service in return. C) for a debt owed. D) for a service. E) for a consumption good.
Which of the following is always true of monopolists?
a. They charge the highest possible price. b. They always earn high profits. c. They do not have to worry about demand. d. They charge a price higher than marginal cost.
Which of the following is true about renewable resources? a. Land resources include oil, coal, and natural gas that have a fixed stock. b. Land resources include irrigation networks and wastewater treatment plants that utilize water
c. Land resources include air filtration systems in buildings that renew and refresh polluted air from the outside. d. Land resources include forests, range lands, and marine fisheries that naturally regenerate.
Economists believe that production possibilities frontiers are often bowed because
a. trade-offs inevitably create unemployment. b. resources are not completely adaptable. c. opportunity costs are constant. d. of improvements in technology.