When a Domestic Currency Is Completely Backed by a Foreign

question 9

Multiple Choice

When a domestic currency is completely backed by a foreign currency and the note-issuing authority establishes a fixed exchange rate to this foreign currency,then the country is said to have

• A)created a currency board.
• B)undergone dollarization.
• C)adopted a managed exchange system.
• D)adopted an exchange rate monetary system.

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Definitions:

Eardrum

A thin membrane that separates the external ear from the middle ear and vibrates in response to sound waves.

Temporal Bone

A large bone situated at the base and side of the skull, which houses the structures of the ear.

Pinna

The external part of the ear that captures sound waves and directs them into the ear canal.

Visual Cortex

The region of the brain located in the occipital lobe that processes visual information received from the eyes.