Which of the Following Is Not a Disadvantage of Exchange-Rate

question 129

Multiple Choice

Which of the following is not a disadvantage of exchange-rate targeting?

• A) It relies on a stable money-inflation relationship.
• B) The targeting country gives up an independent monetary policy.
• C) The targeting country is left open for a speculative attack.
• D) It can weaken the accountability of policymakers.

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Definitions:

Retained Earnings

The portion of net income that is retained by the company rather than distributed to its owners as dividends.

Common Shares

Equity securities that represent ownership in a corporation, providing voting rights and a share in the company's profits through dividends.

Dividends in Arrears

Outstanding dividends on cumulative preferred stock that have not been declared or paid for the prescribed dividend period.

Common Shareholders' Equity

The portion of a company's equity that belongs to common shareholders, representing their ownership interest.