Question 1
Figure 19-8
Refer to Figure 19-8. The equilibrium exchange rate is originally at A, $1.25/euro. Suppose the European Central Bank pegs its currency at $1.00/euro. Speculators expect that the value of the euro will rise and this shifts the demand curve for euro to D
2. If the European Central Bank abandons the peg, the equilibrium exchange rate would be
◦ $1.00/euro.
◦ $1.25/euro.
◦ $1.50/euro.
◦ $1.75/euro.
Question 2
Figure 19-10
Refer to Figure 19-10. Under the Bretton Woods System of exchange rates, if the par exchange rate was $4 per pound in the figure above, then which of the following is true?
◦ The Bank of England would have to buy 0.7 million pounds per day with dollars.
◦ There is a shortage of pounds equal to 0.7 million.
◦ The Bank of England would have to sell 0.7 million pounds per day in exchange for dollars.
◦ The par exchange rate is below the equilibrium rate, causing a shortage of domestic currency.
The immune system has several different components that work in concert.
The nervous system.
An emission tester that uses nitrogen to pressurize the fuel system.
The human digestive system
The urinary system
Human Lungs (Respiratory System)