In the Long Run, Exchange Rates Are Mainly Determined by

question 85

Multiple Choice

In the long run, exchange rates are mainly determined by

• A) the difference between short-run interest rates in each county.
• B) the rate at which a country's currency exchanges for silver or gold.
• C) agreements among governments in the major banking countries of the world.
• D) market fundamentals, such as productivity levels or price levels in various countries.

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Definitions:

Latent Learning

The process of learning that occurs without any immediate or apparent reinforcement, which becomes apparent only when there is a reason to demonstrate it.

Unconditioned Stimulus

In classical conditioning, a stimulus that naturally and automatically triggers a response without any prior learning.

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually comes to trigger a conditioned response.

Acquisition

The initial learning of the connection between the unconditioned stimulus and the conditioned stimulus when these two stimuli are paired.