Under a System of Fixed Exchange Rates, a Country Experiencing

question 42

Multiple Choice

Under a system of fixed exchange rates, a country experiencing unemployment and a balance of payments surplus should employ

• A)expansionary monetary policy
• B)expansionary fiscal policy
• C)an income tax cut combined with a devaluation of the currency
• D)open market sales combined with a devaluation of the currency
• E)a combination of restrictive fiscal and expansionary monetary policy

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Definitions:

Efficiency

The ability to accomplish a task or a job with a minimum expenditure of time, effort, and resources.

Proposed Program Section

A section of a plan or proposal that outlines the details, objectives, and activities of a program that is being suggested.

Scholarship

Financial support awarded to a student on the basis of academic or other achievement to help fund their education.

Justification

The reasoning behind a decision or action, often provided to explain why it is appropriate or required.