With a System of Flexible Exchange Rates,an Increase in Demand

question 23

Multiple Choice

With a system of flexible exchange rates,an increase in demand for a country's currency will cause:

• A)a temporary excess supply of the currency
• B)a temporary excess demand of the currency
• C)a drop in the value of the country's currency
• D)an ongoing balance of payments deficit
• E)an ongoing balance of payments surplus

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