Exhibit 34-4 ​

question 77

Multiple Choice

Exhibit 34-4
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-Refer to Exhibit 34-4. Under a fixed exchange rate system, at the exchange rate of E₃, the peso is __________ and there is a __________.

• A)overvalued; surplus of dollars
• B)undervalued; shortage of pesos
• C)overvalued; shortage of dollars
• D)undervalued; surplus of pesos