A fixed exchange rate is an exchange rate whose value:
A. is set by official government policy.
B. varies according to supply and demand for the currency in the foreign exchange market.
C. reflects the comparative advantage of the home country versus other foreign countries.
D. is established annually by the International Monetary Fund.
Answer: A
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In a market with a rent ceiling set below the equilibrium rent, the producer and consumer surplus
A) both increase. B) both decrease, but generally not to zero. C) do not change. D) are eliminated. E) are both totally converted into deadweight loss.
Which one of the following is an example of passive policy making?
A) introducing expansionary monetary policy to combat a recession B) introducing expansionary monetary policy to combat inflation C) introducing expansionary fiscal policy to combat a recession D) following a predetermined monetary policy rule
If a student borrowed $5,000 at a fixed rate of 8.9 percent to pay for this year's college expenses and the annual inflation rate turns out to be 11 percent, then the student's purchasing power for the year has increased
a. True b. False Indicate whether the statement is true or false
The ZZZ Corporation issued $25 million in new common stock in 2016. It used $18 million of the proceeds to replace obsolete equipment in its factory and $7 million to repay bank loans. As a result, investment:
A. has not occurred. B. of $7 million has occurred. C. of $18 million has occurred. D. of $25 million has occurred.