A persistent surplus of pounds at a given fixed exchange rate (in dollars per pound) is evidence that the pound is ________ versus the dollar. This surplus can be reduced or eliminated through a ________ of the pound.
A) overvalued; revaluation B) overvalued; devaluation
C) undervalued; devaluation D) undervalued; revaluation
Question 2
An outward shift of a nation's production possibilities frontier represents
A) a situation in which a country produces more of one good and less of another.
B) an impossible situation.
C) economic growth.
D) rising prices of the two goods on the production possibilities frontier model.
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