Consider That Britain Is Trying to Maintain a Fixed Exchange

question 21

Multiple Choice

Consider that Britain is trying to maintain a fixed exchange rate with respect to the U.S. dollar. However, the present situation in the foreign exchange market is conducive for the British pound to depreciate with respect to the U.S. dollar. If the British government intervenes in the foreign exchange market, then it can be inferred that:

• A)Britain is financing a surplus in its overall balance of payments.
• B)the British money supply will rise.
• C)Britain is financing a deficit in its overall balance of payments.
• D)Britain is gaining official international reserves.

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Definitions:

Band Society

A small, kinship-based group of foragers who hunt and gather for a living over a particular territory.

Offenses

Acts that go against the law or rules, typically resulting in some form of legal or social sanction.

Cultural Control

Cultural control refers to the ways in which society uses norms, laws, and social institutions to regulate individuals' behavior and maintain social order.

Sanctions

Measures taken by countries or international bodies against a state or individual to compel obedience to law or punish for violations.