To Offset an Increased Demand for Its Currency, a Government

question 39

Multiple Choice

To offset an increased demand for its currency, a government fixing its exchange rate

• A)must sell gold or some other precious metal.
• B)must increase the supply of the foreign currency.
• C)must increase the supply of its currency.
• D)must make it illegal to sell its currency.

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Definitions:

Duty Of Obedience

A legal or ethical obligation requiring individuals to follow the lawful orders and policies of an organization or authority.

Duty Of Loyalty

A legal obligation requiring individuals to act in the best interests of another party, typically in a fiduciary relationship.

Agency Relationship

A legal bond where one party, the agent, acts on behalf of another party, the principal, in a business transaction.

Irrevocable

Something that cannot be changed, reversed, or undone, typically referring to certain contracts, trusts, or agreements.