The advantage of an effective exchange rate is
A) it gives us an accurate gauge for the strengthening or weakening of a currency.
B) it uses a weighted average of bilateral exchanges based on the country's trading partners.
C) unreliable because its using different weights to reflect trade flows.
D) A and B.
Question 2
The purpose of commodity buffer stocks is
(a) to moderate price fluctuations.
(b) to raise commodity prices.
(c) to encourage commodity substitution.
(d) to guarantee national security.
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