If Speculators Believe a Currency Is Undervalued,their Trades in International

question 144

Multiple Choice

If speculators believe a currency is undervalued,their trades in international exchange markets will

• A)increase the surplus of the currency at the existing fixed exchange rate.
• B)decrease the surplus of the currency at the existing fixed exchange rate.
• C)decrease the shortage of the currency at the existing fixed exchange rate.
• D)increase the shortage of the currency at the existing fixed exchange rate.

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Definitions:

Secondary

Pertains to the second level or stage in a sequence, often referring to education that follows primary or elementary education.

Capitalist Economy

An economic system based on private ownership of the means of production and the creation of goods or services for profit.

Regulation

The establishment of rules by government or other authorities to control or govern conduct within a specific area.

Substantial

Of considerable importance, size, or worth; a term indicating something that is large enough in magnitude or number to merit attention.