Under the Bretton Woods system,if IMF loans were insufficient to prevent ________ of a currency,then the country was allowed to devalue its currency by setting a new,________ exchange rate.

Question

Quizplus · Accepted Answer

IMF loans were meant to stabilize a currency's value, but if they were insufficient, the country could devalue its currency by setting a lower exchange rate. Depreciation means a decrease in the value of a currency, and a lower exchange rate means that it takes more units of that currency to purchase another currency. Therefore, A is the correct choice.

Under the Bretton Woods System,if IMF Loans Were Insufficient to Prevent