After the Bretton Woods System Was Abandoned in the Early

question 23

Multiple Choice

After the Bretton Woods system was abandoned in the early 1970s, U.S. exchange rates became the products of implicit or explicit international agreements that

• A) call for exchange rates to float freely and be "managed" by market forces.
• B) call for exchange rates to be fixed by active, "hold up the lamppost" intervention by central banks across the world.
• C) call for exchange rates to fluctuate freely in markets, apart from occasional intervention by major central banks in times of extreme turbulence.
• D) either b or c, depending on circumstance.
• E) none of the above.

---

Definitions:

Planning Budget

A budget designed for a particular level of activity, often used for evaluating potential income and expenditures for future accounting periods.

Direct Labor

The labor costs of employees who are directly involved in the production of goods or services.

Budgeted Units

The quantity of products or services that an organization plans to produce or sell in a specific period according to its budget.

Static Budget

A fixed budget plan that does not change with actual levels of output or activity achieved during a period.