Under the Monetary Approach to the Exchange Rate

question 37

Multiple Choice

Under the monetary approach to the exchange rate

• A) a reduction in the money supply will cause immediate currency depreciation.
• B) a rise in the money supply will cause currency depreciation.
• C) a rise in the money supply will cause immediate currency appreciation.
• D) a rise in the money supply will cause depreciation.
• E) a rise in the money supply will cause immediate currency depreciation.

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