The Use of Foreign Exchange Reserves to Keep Exchange Rates

question 167

Multiple Choice

The use of foreign exchange reserves to keep exchange rates constant over time is called

• A)a fixed exchange rate system.
• B)the Bretton Woods system.
• C)a fiscal fix.
• D)a floating exchange rate system.

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Definitions:

External Failure Costs

Costs incurred when a customer receives a defective product.

Appraisal Costs

Costs related to identifying defective units before they are shipped to customers.

Optimum Quality Level

The level of quality at which the total cost associated with quality management (including prevention, appraisal, and failure) is minimized.

Balanced Scorecard

A set of performance measures that provide a comprehensive view of the organization by recognizing the goals of shareholders, the satisfaction of customers and employees, and methods to improve the firms internal processes.