To fix the foreign currency price of domestic currency below the free market equilibrium rate, a government must:
a. sell both its own currency and foreign exchange.
b. buy its own currency and sell foreign exchange.
c. buy both its own currency and foreign exchange.
d. sell its own currency and buy foreign exchange.
e. revalue its own currency.
b
Economics
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Over a short-run period (i.e., week or month), ________ dominate exchange rate movements
A) short-run inflation differentials B) nominal price changes C) relative price changes D) None of the above
Economics
If the utility function (U) between food (F) and clothing (C) can be represented as U = , the marginal rate of substitution of clothing for food equals
A) -C/F. B) -F/C. C) - . D) - .
Economics