Because Many Emerging Market Countries Have Not Developed the Political

question 54

Multiple Choice

Because many emerging market countries have not developed the political or monetary institutions that allow the successful use of discretionary monetary policy

• A)they have little to gain from pegging their exchange rate to an anchor country like the U.S. or Germany.
• B)they have little to gain from using a nominal anchor,because it would mean a monetary policy that is overly expansionary.
• C)they have very little to gain from an independent monetary policy,but a lot to lose.
• D)they would be better off giving their central bankers the independence to use discretion,rather than take their discretion away through any nominal anchor.

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Definitions:

Corpus Callosum

The thick bundle of nerve fibers connecting the right and left halves of the brain.

Brain Stem

The part of the brain connecting the spinal cord with the forebrain and cerebrum, controlling basic life functions like breathing, heart rate, and arousal.

Frontal Lobes

The part of the brain located at the front of each cerebral hemisphere, responsible for voluntary movement, speech, and complex cognitive functions.

Frontal Lobes

The part of the brain located in the frontal region, responsible for higher cognitive functions including decision making, problem-solving, and controlling social behavior.