Changes in a Currency's Exchange Rate Adjust Immediately to Insure

question 34

Multiple Choice

Changes in a currency's exchange rate adjust immediately to insure that

• A) purchasing power parity always prevails.
• B) interest rate parity always prevails.
• C) official settlements account parity always prevails.
• D) net exports always equal zero.
• E) current account balance equals zero.

---

Definitions:

Latin-American

Pertaining to cultures and peoples of countries in the Americas where Romance languages, primarily Spanish and Portuguese, are spoken.

Impractical

Not sensible or realistic in application; not feasible in practice.

Discrimination

Unfair or prejudicial treatment of individuals or groups based on characteristics such as race, gender, age, or sexual orientation.

Stereotyping

The act of categorizing individuals into specific groups based on generalized traits, without acknowledging individual differences.