Under a system of fixed exchange rates, what happens if a country's currency is overvalued?
A) The central bank loses official reserve assets.
B) The central bank gains official reserve assets.
C) The currency appreciates.
D) The exchange rate rises.
A
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What will be an ideal response?
Suppose a manufacturer of software develops a new computer program that sells for $50. The $50 cost includes $0.25 for the CD it is stored on, $5 for the labor of the company software programmers, and $1.75 for packaging materials and transportation costs. Value added by the software company is
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