Suppose that the United States fixes the dollar-pound exchange rate. In the process of maintaining the fixed exchange rate, if the U.S. central bank starts to realize reduced reserves of pounds, this suggests that
A) the quantity supplied of pounds has exceeded the quantity demanded of pounds.
B) the quantity demanded of pounds has exceeded the quantity supplied of pounds.
C) the exchange rate will rise.
D) the U.S. supply of dollars has increased.
Correct Answer:
Verified
Q119: Which of the following have substantially equivalent
Q120: Q121: The official reserves of a nation's central Q122: Assume that, under a system of floating Q123: Under the managed floating system of exchange Q125: Under a system of flexible exchange rates, Q126: In saying that the present system of Q127: The idea that floating exchange rates will Q128: Which of the following problems will most Q129: Assume that Switzerland and Britain have floating
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents