When the Exchange Rate Is

question 48

Multiple Choice

When the exchange rate is

• A) flexible, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
• B) fixed, purposeful stabilization is less difficult because monetary policy has no power at all to affect domestic output and employment.
• C) fixed, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
• D) a crawling peg, rather than fixed, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
• E) fixed rather than crawling peg purposeful stabilization is more difficult because fiscal policy has no power at all to affect domestic output and employment.