Because Many Emerging Market Countries Have Not Developed the Political

question 54

Multiple Choice

Because many emerging market countries have not developed the political or monetary institutions that allow the successful use of discretionary monetary policy

• A)they have little to gain from pegging their exchange rate to an anchor country like the U.S. or Germany.
• B)they have little to gain from using a nominal anchor,because it would mean a monetary policy that is overly expansionary.
• C)they have very little to gain from an independent monetary policy,but a lot to lose.
• D)they would be better off giving their central bankers the independence to use discretion,rather than take their discretion away through any nominal anchor.

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Definitions:

One-Sided Hypothesis

A one-sided hypothesis test, also known as a directional hypothesis, tests the possibility of a relationship in a specific direction.

Null Hypothesis

A default hypothesis that there is no significant difference or effect, often tested against an alternative hypothesis in statistical analysis.

Two-Tail Test

A statistical test that considers both directions of a distribution to determine if there is a significant difference from the hypothesized value, useful for checking inequalities.

Null Hypothesis

A default hypothesis that there is no difference or effect, often tested to determine the likelihood of observing the sample data.