Which of the Following Exchange Rate Policies Uses a Target

question 33

Multiple Choice

Which of the following exchange rate policies uses a target exchange rate,but allows the target to change?

• A)crawling peg
• B)flexible exchange rate
• C)fixed exchange rate
• D)moving target
• E)none of the above

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Definitions:

Comparative Balance Sheets

Financial reports that compare the balance sheets of a company at two or more different points in time, to analyze trends or changes in financial position.

Cash Flows

The total amount of money being transferred in and out of a business, especially as affecting liquidity.

Equipment

Tangible, long-term assets used in the operation of a business, not intended for resale, such as machinery, office furniture, and computers.

Hedging Reserve

A financial reserve established to offset potential losses or gains due to future price or currency fluctuations, often related to commodity or foreign exchange hedging.