There Is a Flexible Exchange Rate System and Only Two

question 1

Multiple Choice

There is a flexible exchange rate system and only two countries in the world,the United States and Mexico.If the inflation rate in the United States rises relative to the inflation rate in Mexico,it follows that

• A) the dollar will appreciate and the peso will depreciate.
• B) both the dollar and the peso will appreciate,although the peso will appreciate before the dollar appreciates.
• C) the dollar will depreciate and the peso will appreciate.
• D) both the dollar and the peso will depreciate,although the peso will depreciate before the dollar depreciates.
• E) There is not enough information to answer the question.

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Definitions:

Negative Punishment

A behavioral psychology concept where decreasing undesired behaviors occurs by removing a desirable stimulus after the behavior.

Latency Stage

A period in Freudian psychosexual development occurring from age six to puberty, where sexual urges are repressed and focus shifts to social and intellectual skills.

Anal Stage

A phase in Freud's psychosexual development, occurring from about 18 months to 3 years of age, where the child's focus is on controlling bladder and bowel movements.

Genital Stage

A phase in Freud's psychosexual development theory occurring in puberty, where libido is centered on the genital area, and the focus is on mature sexual relationships.