China Fixes Its Exchange Rate (Yuan Per Units of Foreign

question 114

Multiple Choice

China fixes its exchange rate (yuan per units of foreign currency) at a rate above its free-market equilibrium level.In order to maintain this exchange rate,and to prevent its currency from ________,the Chinese central bank must be accumulating ________.

• A)appreciating; foreign-exchange reserves
• B)appreciating; reserves of its domestic currency
• C)depreciating; foreign-exchange reserves
• D)depreciating; reserves of its domestic currency
• E)depreciating; U.S.dollars

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Definitions:

Topping Out Effect

Refers to a situation where growth or improvement reaches a maximum level and no significant advancement seems possible.

Profit-Sharing Programs

A company policy where a portion of the company's profits is distributed to its employees, often based on their performance or as an incentive.

Organizational Performance

The measure of how effectively an organization meets its objectives and achieves its goals.

Profit-Sharing Program

A company program in which employees receive a portion of the company’s profits, typically as a part of their compensation package, to motivate and reward them for their contribution to the company's success.