Which of the following will most likely cause a nation's currency to appreciate on the foreign exchange market?
a. A decrease in domestic interest rates
b. An increase in foreign interest rates
c. Domestic inflation of 10 percent while the nation's trading partners are experiencing stable prices
d. Stable domestic prices while the nation's trading partners are experiencing 10 percent inflation
d
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When aggregate expenditure falls short of the level needed to generate a full- employment, noninflationary equilibrium, then a recessionary gap exists
Indicate whether the statement is true or false
The type of banking system under which banks are required to hold only a portion of their assets in reserve against the checking deposits of their customers is called
a. a gold-backed banking system. b. a full reserve banking system. c. a fiat banking system. d. a fractional reserve banking system.