Under a ?Xed Exchange Rate Regime, ?Scal Policy Is

question 82

Multiple Choice

Under a ?xed exchange rate regime, ?scal policy is:

• A) less effective than monetary policy because the central bank prints money to counter in?ation.
• B) more effective than monetary policy because the central bank cannot change interest
• C) less effective than monetary policy as the central bank increases interest rates to counter in?ationary pressures.
• D) more effective than monetary policy because exchange rate differentials are offset by

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Definitions:

Wholesaler

A type of intermediary in the distribution channel that purchases goods in large quantities from manufacturers or importers and sells them to retailers or other businesses.

Conforming Goods

Merchandise or products that meet the specifications and standards outlined in a purchase contract.

Acceptance

A promise or act on the part of an offeree indicating a willingness to be bound by the terms and conditions contained in an offer. Also, the acknowledgment of the drawee that binds the drawee to the terms of a draft.

Purchase Order

A document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services.