Which of the following is not associated with an exchange-rate shock linked to intervention in the foreign exchange market?
A) a rising debt/export ratio
B) falling foreign reserves
C) rising debt
D) a falling debt/export ratio
E) low FDI

Question

Quizplus · Accepted Answer

An exchange-rate shock linked to intervention in the foreign exchange market typically does not lead to a falling debt/export ratio. Instead, such interventions can lead to outcomes like rising debt/export ratios, falling foreign reserves, rising debt, or low FDI due to the impact on the country's balance of payments and currency value.

Which of the Following Is Not Associated with an Exchange-Rate