The Graph Below Shows the Supply and Demand for Swiss

question 6

Multiple Choice

The graph below shows the supply and demand for Swiss francs in the absence of any intervention by the central monetary authorities.$0.25 is the value of the franc fixed by the central bank.Which of the following is correct?

• A)The Swiss franc is overvalued.
• B)Switzerland's balance of payments is likely to be in large surplus.
• C)At the $0.25 value there is an excess demand for Swiss francs.
• D)At the $0.20 value there is an excess supply of Swiss francs.

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