Which of the Following Statements Is the MOST Accurate

question 35

Multiple Choice

Which of the following statements is the MOST accurate?
In general

• A) the monetary approach to the exchange rate is a long run theory.
• B) the monetary approach to the exchange rate is a short run theory.
• C) the monetary approach to the exchange rate is both a short and long run theory.
• D) the monetary approach to the exchange rate neither long run nor short run theory.
• E) the monetary approach to the exchange rate is considered less practical than the law of one price.

---

Definitions:

Apples

Commonly refers to the edible fruit produced by an apple tree, used in various cuisines worldwide.

Bananas

A long, curved fruit with a yellow skin and soft, sweet, white flesh inside, commonly eaten as a snack or used in culinary dishes.

Utility Function

A mathematical representation that quantifies the satisfaction or happiness an individual derives from consuming goods and services.

Budget Constraint

A budget constraint represents the limits imposed on household choices by income, wealth, and commodity prices.