Why Can Interactions in an International Monetary Regime Be Like

question 4

Multiple Choice

Why can interactions in an international monetary regime be like a Prisoner's Dilemma?

• A)Each government has an incentive to cheat by pegging its currency;the result is a world where every government wants to peg its currency to someone else.
• B)Each government has an incentive to cheat by devaluing its currency,and the result is all governments become worse off because of competitive devaluations.
• C)Each government faces a choice between fixing its currency's exchange rate or letting the currency float freely.
• D)Each government is trapped by the rules of the international monetary regime.
• E)All governments have a clear incentive to create an international government to regulate monetary affairs even though this will make them captive to its rules.

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Definitions:

Apologizing

The act of expressing regret or sorry for one's actions or words, often used as a means to mend or maintain social relationships.

Guilty

A legal term denoting that someone has been found responsible for committing a crime or offense, or a feeling of having done wrong or committed a misdemeanor.

Acquaintances

Individuals known by someone, but usually not close friends.

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A figurine used in certain rituals, often associated with the belief in magical practices, to represent a person for purposes of casting spells on them, typically for harm.