Managed Floats of Currencies Have All of the Following Characteristics

question 33

Multiple Choice

Managed floats of currencies have all of the following characteristics except:

• A) They allow currency values to be determined purely by supply and demand
• B) Countries can use fiscal and/or monetary policies to influence exchange rate values
• C) Allows nations to raise or lower interest rates to attract or deter foreign capital
• D) Permits countries to change taxation structures to encourage or discourage

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Definitions:

Fixed Costs

Rent, salaries, and insurance are examples of expenses unaffected by changes in production or sales levels.

Variable Costs

Expenditures that fluctuate in accordance with the amount of products made or sold.

Inventoriable Costs

Expenses directly connected to the production of goods that are initially recorded as inventory and expensed as cost of goods sold when the goods are sold.

Manufacturing Overheads

All indirect costs associated with the production process, including utilities, maintenance, and factory management salaries.