Suppose That Econland Adopts a Fixed Exchange-Rate System and Pegs

question 274

Multiple Choice

Suppose that Econland adopts a fixed exchange-rate system and pegs the value of its peso to the U.S. dollar. If people's demand for pesos increases in the foreign exchange markets, then Econland's foreign-exchange reserves will

• A)increase.
• B)decrease.
• C)stay the same.
• D)equal the trade balance.

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Definitions:

National Samples

Are representative selections of individuals or entities drawn from a country's population, often used in surveys or research to make inferences about the general population.

College Education

Higher education pursued after the completion of secondary education, typically in a college or university, offering degrees in various fields.

Gender Gap

The difference in attitudes or behaviors between women and men, often observed in voting patterns and political opinions.

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