Under a Managed Float Exchange Rate System, the Bank of England

question 37

Multiple Choice

Under a managed float exchange rate system, the Bank of England may attempt to stimulate the UK economy by ____ the pound. Such an adjustment in the pound's value should ____ the UK demand for products produced by major foreign countries.

• A) weakening; increase
• B) weakening; decrease
• C) strengthening; increase
• D) strengthening; decrease

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Definitions:

Wholly Owned

A company or entity that is 100% owned by another company or individual.

Vertical Boycott

An anti-competitive practice where companies at different supply chain levels agree not to deal with a particular company or group.

Sherman Act

A landmark federal statute in the anti-trust law of the United States that prohibits monopolistic practices and promotes competition.

Price-Cutter

An individual or company that significantly reduces the prices of goods or services, typically to attract more customers or to outcompete rivals.