If there is a greater degree of economic integration between markets in the home country and the base country:
A) the home country will benefit to a greater degree by fixing its exchange rate with the base country.
B) efficiency will be reduced with fixed exchange rates.
C) flexible exchange rates will result in GDP stability.
D) the volume of transactions will be too low to justify an elaborate exchange rate policy.
Ans: A) the home country will benefit to a greater degree by fixing its exchange rate with the base country.
You might also like to view...
The marginal productivity of labor will eventually decrease as more workers are employed because
A) average product is increasing. B) total product is decreasing. C) the amount of capital will also be increasing. D) on the average each worker will have fewer inputs to work with.
In the graph below, the change in the individual's preferences indicated by a shift from indifference curve A to indifference curve B will result in:
A. A decrease in demand for good Y
B. No change in the demand for good Y
C. A decrease in demand for good X
D. An increase in demand for good X