In the graph above, what do the dotted lines represent? A) ...

[Tazate]

In the graph above, what do the dotted lines represent?
 
  A) transaction and opportunity costs
  B) the boundaries of profitability for arbitrage
  C) the risk premium associated with the countries
  D) the variability in spot rate expectations

Question 2

A fixed exchange rate system reduces the impact of
 
  A) variations in the demand for real money balances on real incomes.
  B) the volatility of aggregate expenditures on real incomes.
  C) crowding out from fiscal expenditures.
  D) the beggar-thy-neighbor effect.

[sierramartinez]

Answer to Question 1

A

Answer to Question 2

A

[Tazate]

Thanks for the timely response, appreciate it

[jordangronback]

Wow, this really help