To prevent the dollar from depreciating, the U.S. central bank can try to fix the currency value of the dollar when they
A) buy U.S. dollars in the foreign exchange market.
B) sell U.S. dollars in the foreign exchange market.
C) abandon the U.S. dollar and use another country's currency as its legal currency.
D) buy foreign currencies in the foreign exchange market.
A
You might also like to view...
Suppose a nation's real Gross Domestic Product (GDP) grows at a rate of 2 percent per year while its population grows 2 percent annually. Given this information, this nation's annual rate of per capita real GDP growth is equal to
A) 1 percent. B) -1 percent. C) 0 percent. D) 4 percent.
If there is an inflationary gap, what is the proper monetary policy to restore price stability? What actions can the Fed undertake to restore price stability?
What will be an ideal response?
Sandra has been working as a software engineer for five years and Jack has been working as a software engineer for two years. Which of the following statements is true of Sandra and Jack?
A) Sandra is likely to earn lower wages than Jack. B) Sandra is likely to earn the same wage as Jack. C) Sandra is likely to be more productive at work than Jack. D) Sandra is likely to be equally productivity at work as Jack.
If a perfectly competitive firm is operating in the short run and seeks to maximize profit, the firm should:
a. increase output whenever marginal cost is less than average total cost. b. increase output whenever marginal revenue is less than marginal cost. c. choose the output where per-unit profit is greatest d. increase output whenever price exceeds marginal cost.