Albania Wants to Maintain an Exchange Rate of $0

question 30

Multiple Choice

Albania wants to maintain an exchange rate of $0.20 per lek.However, the market for lek per U.S.dollar has determined an exchange rate of $0.14 per lek (depreciation of the lek against the U.S.dollar) .The Croatian central bank decides to increase the domestic interest rates through a contractionary monetary policy.This would shift the:

• A)supply of lek to the left and cause the lek to lose value.
• B)supply of lek to the right and cause the lek to lose value.
• C)demand of lek to the right and cause the lek to gain value.
• D)demand of lek to the left and cause the lek to lose value.

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Definitions:

Object Integration

The process of combining different elements or pieces of information into a cohesive whole.

Conscious Mind

The aspect of the mind that involves awareness of thoughts, feelings, and surroundings in the present moment.

Unconscious Mind

A part of the mind that is not in forefront awareness but influences thoughts, feelings, and behaviors.

Usual Awareness

The routine level of conscious knowledge or perception of the environment and one's own thoughts and feelings.