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Exchange Rates Are Unlikely to Change If

Question 25

Multiple Choice

Exchange rates are unlikely to change if


A) the U.S. inflation rate is twice that of other developed nations.
B) current account budget deficits/surpluses are offset by reverse capital flows.
C) the current account deficits in the U.S. are offset by capital flows much larger than the current account deficit.
D) central banks want them stable.

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