A currency devaluation is a(n):
A. increase in the official value of a currency in a fixed-exchange-rate system.
B. decrease in the value of a currency relative to other currencies.
C. reduction in the official value of a currency in a fixed-exchange-rate system.
D. increase in the value of a currency relative to other currencies.
Answer: C
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The above figure depicts the Edgeworth box for two individuals, Al and Bruce. Points a and b
A) are most likely to reflect the final allocations after trading. B) are least likely to reflect the final allocations after trading. C) are equally likely to reflect the final allocations after trading than other points on the contract curve. D) are definitely not the final allocations after trading.
If a new computer program was developed that dramatically improved productivity in most firms, what would happen in the labor market?
a. The real wage would not change but employment would decrease. b. The real wage would increase and employment would decrease. c. The real wage would decrease and so would employment. d. The real wage would decrease and employment would increase. e. The real wage would increase and so would employment.