Distinguish between fixed and flexible exchange rate systems. ...

[CORALGRILL2014]

Distinguish between fixed and flexible exchange rate systems.
 
  What will be an ideal response?

Question 2

When the price level increases, aggregate planned expenditure decreases, which leads to
 
  A) a rightward shift of the aggregate demand curve.
  B) neither a movement along nor a shift of the aggregate demand curve.
  C) a downward movement along the aggregate demand curve.
  D) an upward movement along the aggregate demand curve.
  E) a leftward shift of the aggregate demand curve.

[kingdude89]

Answer to Question 1

A fixed exchange rate system is a system in which governments peg exchange rates to prevent their currencies from fluctuating. A flexible exchange rate system is a system in which exchange rates are determined by free markets.

Answer to Question 2

D

[CORALGRILL2014]

Thanks for the timely response, appreciate it

[bitingbit]

Excellent