Under fixed exchange rate, in general A) the domestic and ...

[littleanan]

Under fixed exchange rate, in general
 
  A) the domestic and foreign interest rates are equal, R = R .
  B) R = R + (Ee - E)/E.
  C) the foreign and domestic interest rates are unequal.
  D) the expected rate of domestic currency depreciation is high.
  E) the expected rate of currency depreciation is one.

Question 2

The United States finances current account deficits largely with dollars and, as a result, faces almost no constraint on its ability to run deficits.
 
  Indicate whether the statement is true or false

[macybarnes]

Answer to Question 1

A

Answer to Question 2

TRUE

[littleanan]

TYSM

[bulacsom]

Excellent