Which of the Following Is True

question 53

Multiple Choice

Which of the following is true?

• A)Countries that want to have a fixed exchange-rate regime should be willing to refrain from policy changes that lead to large international capital flows.
• B)For a floating exchange-rate to work for a country, it cannot have an inflation rate that is much above the inflation rate(s) of its primary trading partners.
• C)Fixed exchange-rates encourage countries to have different goals, priorities and policies with respect to macroeconomic variables.
• D)If capital is highly mobile, fiscal policy then loses its effectiveness under a fixed exchange rate.

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Definitions:

Recall

The act of retrieving information or memory from the past, which can vary in effort depending on how the information was encoded and stored.

Decay

The process of gradual deterioration or the breakdown of organic matter resulting from natural physical or chemical processes.

Memories Traces

Theoretical constructs representing the physical and psychological evidence of memories stored in the brain.

Forgetting Theories

Various explanations and models proposed to understand the process and reasons behind the loss of information from memory over time.