This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: What is the drawback for a country that chooses to fix its exchange rate? a. Fixing the exchange ... (Read 98 times)

daltonest1984

  • Hero Member
  • *****
  • Posts: 536
on: Jun 30, 2018
What is the drawback for a country that chooses to fix its exchange rate?
 a. Fixing the exchange rate can deteriorate the international competitiveness because the real exchange rate can't fluctuate anymore.
  b. Businesses in the country are more exposed to business risks associated with exchange rate changes.
  c. The central bank loses its ability to influence the money supply, unless severe capital controls are imposed.
  d. Fixing the exchange rate has no disadvantages and should be adopted by all countries.

Question 2

Cashing out capital gains in Virtual Currency System 3 (i.e., turning virtual capital gains into real world currencies) causes the nation's:
 a. Monetary base to rise.
  b. M2 money supply to rise.
  c. M2 money multiplier to rise.
  d. Monetary base to remain the same.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Pswine

  • Sr. Member
  • ****
  • Posts: 328
Reply #1 on: Jun 30, 2018
Answer to Question 1

.C

Answer to Question 2

.D


daltonest1984

  • Member
  • Posts: 536
Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)

EAN94

  • Member
  • Posts: 307
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

« previous next »
 

Did you know?

The Centers for Disease Control and Prevention has released reports detailing the deaths of infants (younger than 1 year of age) who died after being given cold and cough medications. This underscores the importance of educating parents that children younger than 2 years of age should never be given over-the-counter cold and cough medications without consulting their physicians.

Did you know?

As many as 20% of Americans have been infected by the fungus known as Histoplasmosis. While most people are asymptomatic or only have slight symptoms, infection can progress to a rapid and potentially fatal superinfection.

Did you know?

The first oral chemotherapy drug for colon cancer was approved by FDA in 2001.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

Did you know?

Carbamazepine can interfere with the results of home pregnancy tests. If you are taking carbamazepine, do not try to test for pregnancy at home.

Exercise increases the heart rate. Exercise increases the heart rate.
Static Stability & Environmental Lapse Rate Static Stability & Environmental Lapse Rate
Advection of an air mass with a different ELR (environmental lapse rate). Advection of an air mass with a different ELR (environmental lapse rate).
Soils support plant growth through ion exchange Soils support plant growth through ion exchange
The level of future emissions is closely linked to the rate of population growth The level of future emissions is closely linked to the rate of population growth
Consequences of a double exchange occurring between two nonsister chromatids Consequences of a double exchange occurring between two nonsister chromatids
Video: Haustral churning, Gastrocolic reflex and mass peristalsis & Defecation

For a complete list of videos, visit our video library