Under a fixed exchange rate regime, the central bank must act to ...

[jc611]

Under a fixed exchange rate regime, the central bank must act to keep
 
  A) P = P.
  B) the real exchange rate fixed.
  C) i = i.
  D) E = 1.
  E) none of the above

Question 2

Which of the following statements is always true?
 
  A) Investment equals depreciation.
  B) Investment equals the capital stock minus depreciation.
  C) The capital stock is equal to investment minus depreciation.
  D) Any change in the capital stock is equal to investment minus depreciation.
  E) The increase in investment is equal to the capital stock minus depreciation.

[hanadaa]

Answer to Question 1

C

Answer to Question 2

D