Examlex

Solved

Epsilon Is a Country Whose Unit of Currency Is the Omega

question 50

Multiple Choice

Epsilon is a country whose unit of currency is the omega. New information leads people to expect that the omega will appreciate next year. To keep the foreign exchange value of the omega fairly steady, the Bank of Epsilon will ________ enough omegas on the foreign exchange market so that the ________ omegas will ________.


Definitions:

Marginal Propensity

The ratio of the change in an aggregate economic quantity to an adjustment in some causal variable, particularly the change in consumption resulting from a change in income.

U.S. Price Level

A measure of the average prices of goods and services across the United States economy, indicating the purchasing power of money in the U.S.

Net Exports

The value of a country's total exports minus its total imports, representing the net trade of goods and services with foreign countries.

Price Level

The price level is an index that measures the average prices of goods and services across an economy, indicative of inflation or deflation.

Related Questions