Refer to Figure 15.3 for the Following Questions

question 31

Multiple Choice

Refer to Figure 15.3 for the following questions.
Figure 15.3

-Assume that the Thai government wants to maintain an exchange rate of 0.04 baht per United States (US) dollar, as shown in Figure 15.3. If the Thai economy falls into recession, how will that affect the number of baht the central bank must buy or sell to maintain the peg at 0.04 baht per dollar?

• A)They must purchase more than 100 million baht per day with US dollars.
• B)They must purchase less than 100 million baht per day with US dollars.
• C)They must purchase exactly 100 million baht per day with US dollars.
• D)They do not have to do anything.

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Definitions:

Generations

Groups of individuals, typically within a family, who are born and live around the same time, marking distinct stages in societal or familial development.

Collectivism

A cultural value that emphasizes the importance of the group or community over individual achievements or desires.

Individualism

A social and political philosophy that emphasizes the moral worth of the individual over collective or state interests.

Capitalist Economic System

An economic system where private individuals or businesses own capital goods and the production of goods and services is based on supply and demand in the market.