If There Is a Black Market in Foreign Exchange, Then

question 8

Multiple Choice

If there is a black market in foreign exchange, then what is likely to be the case?

• A) There is no intervention in the foreign exchange market.
• B) There are no exchange controls.
• C) There is a free market in foreign exchange market.
• D) all of the above
• E) none of the above

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Definitions:

Induced Consumption

The concept that the level of consumer spending increases as disposable income rises, and decreases as disposable income falls, all else being constant.

Induced Consumption

Induced consumption is the portion of consumer spending that increases with an increase in disposable income.

Disposable Income

The finance available to households for expenditures and saving after reducing income taxes.

Disposable Income

Money that households can earmark for spending and saving after income taxes are considered.