Under the Flexible Exchange Rate System,when a Country Tries to Stimulate

question 39

Multiple Choice

Under the flexible exchange rate system,when a country tries to stimulate economic growth and improve its employment rates,it is likely to cause:

• A)the domestic inflation rate to rise and the domestic currency to depreciate.
• B)the domestic inflation rate to rise and the domestic currency to appreciate.
• C)the domestic inflation rate and the value of the domestic currency to remain constant.
• D)the domestic inflation rate to fall and the domestic currency to appreciate.
• E)the domestic inflation rate to fall and the domestic currency to depreciate.

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Definitions:

Rotor

The rotating part of an electrical or mechanical machine, such as the rotating shaft in a motor or generator.

Inductive Compensation

A method of connecting the compensating windings in a universal motor.

Universal Motor

A type of motor that can be operated on AC or DC power.

AC

Alternating Current refers to an electrical current that periodically changes its direction of charge flow.