Under the Bretton Woods System,a Country Running a Balance of Payments

question 65

Multiple Choice

Under the Bretton Woods system,a country running a balance of payments ________ lost international reserves,and had to implement ________ monetary policy to strengthen its currency.

• A) surplus; expansionary
• B) surplus; contractionary
• C) deficit; expansionary
• D) deficit; contractionary

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Definitions:

Equilibrium Level

The state at which market supply and demand balance each other, resulting in stable prices.

Exports And Imports

The selling of goods and services produced in one country to another country (exports) and the buying of goods and services from another country (imports).

World Price Level

The average of prices for goods and services across different countries, adjusted for exchange rate differences, reflecting the global cost of living.

Diagram

A simplified drawing showing the appearance, structure, or workings of something, often used for explanatory purposes.