Managed Float System of Exchange Rates Refers to a System

question 54

Multiple Choice

Managed float system of exchange rates refers to a system in which currencies float against one another with:

• A)the G8 intervening only to stabilize the currencies at set target exchange rates.
• B)governments intervening only to stabilize their currencies at set target exchange rates.
• C)big business houses intervening only to stabilize the currencies at set target exchange rates.
• D)international financial institutions intervening only to stabilize the currencies at set target exchange rates.
• E)the developed countries intervening only to stabilize the currencies at set target exchange rates.

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Definitions:

Tax Rate

The fraction of earnings or revenue that governmental bodies levy as tax from individuals or corporations.

Straight-Line Depreciation

A process for allocating the cost of a physical asset across its usable life in identical annual payments.

Incremental Cash Flow

The additional cash flow an organization receives from taking on a new project, defined as the difference between the project's cash inflows and outflows.

Lease Payments

Regular payments made by a lessee to a lessor for the use of an asset, typically over the duration of a lease agreement.