Which Is the Following Is True for Countries with Fixed

question 24

Multiple Choice

Which is the following is true for countries with fixed exchange rate regimes?

• A)Central banks of these courtiers are required to maintain exchange reserves to cover 100% of the existing domestic currency
• B)Centrals banks cannot use monetary policy to affect the economics fundamentals (such as inflation)
• C)These countries must use currency board
• D)None of these

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Definitions:

Accounting Profits

Net income reported on a company's financial statements, calculated as total revenues minus explicit costs, excluding opportunity costs.

Economic Profits

The surplus remaining after total costs are subtracted from total revenues, taking into account both explicit and implicit costs.

Accounting Profits

The difference between total revenue and explicit costs; the net income a firm reports on its income statement.

Total Costs

The aggregate of all expenses associated with manufacturing products or services, which includes fixed and variable costs.