Under the Flexible Exchange Rate System,when a Country Tries to Stimulate

question 39

Multiple Choice

Under the flexible exchange rate system,when a country tries to stimulate economic growth and improve its employment rates,it is likely to cause:

• A)the domestic inflation rate to rise and the domestic currency to depreciate.
• B)the domestic inflation rate to rise and the domestic currency to appreciate.
• C)the domestic inflation rate and the value of the domestic currency to remain constant.
• D)the domestic inflation rate to fall and the domestic currency to appreciate.
• E)the domestic inflation rate to fall and the domestic currency to depreciate.

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Definitions:

Morality

Guidelines that separate commendable from condemnable actions.

Rationality

The quality of being based on or in accordance with reason or logic.

Duty

The responsibility or obligation to act in accordance with moral, legal, or professional expectations.