Under a Flexible Exchange Rate System,what Will a Contractionary Fiscal

question 79

Multiple Choice

Under a flexible exchange rate system,what will a contractionary fiscal policy lead to?

• A)a depreciation of the domestic currency
• B)an appreciation of the domestic currency
• C)an increase in foreign reserves
• D)a decrease in foreign reserves

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Definitions:

Mode

The value that occurs most frequently in a given set of data.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values; a low standard deviation indicates that the values tend to be close to the mean of the set.

Variability

Refers to the degree of difference or deviation from the mean within a set of data.

National Mean

The average score or value derived from a dataset that represents a performance or characteristic of a broader population at the national level.