If the equilibrium exchange rate is 15 pesos per dollar and the central bank fixes the exchange rate at 17 pesos per dollar then we can conclude that the peso is

If a check written on one bank is deposited in another bank

A) new reserves are created for the banking system. B) the money supply decreases. C) the money supply remains unchanged. D) the money supply increases.

Zero lower bound refers to the fact that

A) the government budget deficit must be zero in the long run. B) the lowest possible level of the current account deficit is zero in the long run. C) the inflation rate can never decline below zero. D) nominal interest rates cannot fall below zero.