What is a currency board?
What will be an ideal response?
A currency board is a government institution that exchanges domestic currency for foreign currency at a fixed rate of exchange. It is normally established to increase the credibility of a foreign exchange arrangement and thus increase confidence in the system. Currency boards achieve a credible fixed exchange rate by holding a stock of the foreign currency equal to 100 percent of the outstanding currency supply of the nation.
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Which of the following is true? a. Checking account deposits and time deposits constitute assets of banks
b. M2 includes M1, plus saving accounts, time deposits (except for some large-denomination certificates of deposits), and money market mutual funds. c. reserves times the required reserve ratio equals deposits. d. Money is destroyed when banks make loans.
Which of the following statements is false?
A) The Treasury bond information published under the column heading "Yield" is based on the ask price of the bond. B) The Treasury bond information published under the column heading "Yield" is based on the assumption that the bond is held to maturity. C) The Treasury bond information published under the column heading "Bid" indicates the price a buyer will pay if he buys the bond. D) The Treasury bond information published under the column heading "Bid" is the price a buyer will receive if she sells the bond.