Which of the Following Is Not a Potential Disadvantage of Freely

question 5

Multiple Choice

Which of the following is not a potential disadvantage of freely floating exchange rates?

• A) They require larger amounts of international reserves than other exchange systems
• B) Demand schedules for imports and exports may be price speculation
• C) There may occur large amounts of destabilizing speculation
• D) Capital movements among nations may be hindered via exchange rate fluctuations

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Definitions:

Negotiation Table

The setting or forum where parties come together to discuss and resolve differences or make deals.

Interpersonal Aspects

Elements or considerations that pertain to or affect relationships between individuals.

Interaction

A process by which two or more entities (people, organizations, objects) influence or have an effect on each other.

Connection

A relationship in which a person, thing, or idea is linked or associated with something else.