Figure 155 Alt Text for Figure 15

question 39

Multiple Choice

Figure 15.5 Alt text for Figure 15.5: In figure 15.5, a graph illustrates the quantity of yuan traded against the exchange rate.
Long description for Figure 15.5: The x-axis is labelled, quantity of yuan traded in millions per day.The y-axis is labelled, exchange rate, Canadian dollar against the yuan.Supply curve S, is a straight line which slopes up from the bottom left corner to the top right corner.Demand curve D, is a straight line which slopes down from the top left corner to the bottom right corner.The curves intersect at point A, (600, 0.13) .Point A, and unmarked points (800, 0.11) , (500, $0.14) , (700, $0.14) , and (400, 0.11) are all connected to their corresponding values on the x and y-axes with dotted lines.
-Refer to Figure 15.5.The Chinese government pegs the yuan to the U.S.dollar, at one of the specified exchange rates on the graph, such that it undervalues its currency.Using the figure above, this would generate

• A)a shortage of yuan equal to 400 million.
• B)a shortage of yuan equal to 200 million.
• C)a surplus of yuan equal to 200 million.
• D)a surplus of yuan equal to 400 million.
• E)a surplus of yuan equal to 300 million.

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Definitions:

Critical Thinking

The objective analysis and evaluation of an issue in order to form a judgement, characterized by reason and evidence-based assessment.

Appraising

The process of evaluating the significance of situations, stimuli, or events in relation to one’s own well-being.

Evaluating Evidence

The process of critically assessing the reliability, validity, and relevance of data or information in support of conclusions or theories.

Empirical Approach

A method of acquiring knowledge based on observation, experimentation, and experience, rather than through theory or belief.