The balance of payments constraint refers to the limits on:
A. exchange rate policy imposed by flexible exchange rates.
B. currency convertibility observed in most developing countries.
C. domestic macroeconomic policy, arising from a shortage of international reserves.
D. macroeconomic policy resulting from IMF conditionality.
Answer: C
You might also like to view...
In the presence of asymmetric information, a piece-rate contract
A) achieves production efficiency. B) can lead to agents producing more output than would occur under a fixed-rent-paid-to-the-principal contract. C) is impossible to write. D) will result in the principal earning all of the profit.
If a seller knows more about the good than the buyer does, there exists
a. perfect information b. an externality c. a low marginal benefit of information for the buyer d. asymmetric information e. optimal search