A Crawling Peg Is

question 66

Multiple Choice

A crawling peg is:

• A)an exchange rate that is allowed to float or move within a defined or set band relative to another currency.
• B)a managed float where an exchange rate is allowed to appreciate in controlled steps over time.
• C)an exchange rate determined by the supply and demand factors in the FX markets.
• D)a constant rate of exchange between currencies.

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Definitions:

Net Investment

The total amount spent on new capital assets minus the depreciation on existing capital assets.

Autonomous Consumption

The part of consumption that does not change with income levels, representing basic necessities one must purchase regardless of income.

Long-Run Aggregate Supply Curve

A graphical representation showing an economy's potential output when all prices, including wages, can fully adjust to changes in the economic environment.

Business Taxes

Taxes that are required to be paid by businesses based on their income, property, and sometimes their sales.