Which Statement Is True of a World with a System

question 275

Multiple Choice

Which statement is true of a world with a system of fixed exchange rates as opposed to one with floating rates?

• A)It requires less world liquidity or reserves.
• B)It creates less confidence about future values of currencies.
• C)It facilitates the transmission of shifts in economic conditions between countries.
• D)It increases the role of the central banks in foreign exchange markets.

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Definitions:

Food, Conservation, And Energy Act

A law that aims to address issues related to agriculture, conservation, energy, and nutrition support programs.

Direct Payments

Cash transfers from government to individuals or businesses, often used to provide subsidies, welfare benefits, or to stimulate economic activity.

Countercyclical Payments

Government payments or subsidies, especially in agricultural policy, that increase when market prices are low and decrease when they are high, aiming to stabilize income.

Targeted Prices

Pricing strategies that aim specifically at certain segments of the market to maximize profitability and market share.