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:

Dividend Reinvestment Plan

A program that allows investors to automatically reinvest their cash dividends in more shares of the issuing company.

Tax Deferred

A status of investment earnings, such as interest or dividends, that are not subject to tax until they are withdrawn or realized at a future date.

Equity Capital

The funds raised by a company through the sale of common or preferred shares, representing ownership interests in the company.

Floatation Costs

The expenses incurred by a company in issuing new securities, including underwriting, legal, and registration fees.