Which of the Following Arguments Strengthen the Idea of Floating

question 26

Multiple Choice

Which of the following arguments strengthen the idea of floating exchange rates?

• A) External agencies should not interfere in the monetary policies of a country.
• B) Trade deficits can be corrected through changes in exchange rates.
• C) Changes in exchange rates will not impact the trade balance in a country.
• D) Governments should act in ways to minimize the uncertainty in monetary markets.

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Definitions:

Incremental Revenue

The additional revenue generated from a new business action or decision, beyond the existing revenue stream.

Incremental Costs

Incremental costs refer to the additional costs that a company incurs when increasing its production or activities by a small amount, also known as marginal costs.

Accumulated Depreciation

The total amount of depreciation expense recorded for an asset over its life.

Net Advantage

A term used in various contexts to indicate the superiority or benefit achieved by one option over another, often evaluated in decision-making scenarios.