Multiple Choice
Exhibit 35-4 
Refer to Exhibit 35-4. Under a fixed exchange rate system, at the exchange rate of E3, the peso is __________ and there is a __________.
A) overvalued; surplus of dollars
B) undervalued; shortage of pesos
C) overvalued; shortage of dollars
D) undervalued; surplus of pesos
Correct Answer:
Verified
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