Which of the Following Is a Way in Which a Fixed

question 82

Multiple Choice

Which of the following is a way in which a fixed exchange rate regime imposes discipline?

• A)The need to maintain a fixed rate puts a brake on competitive devaluations.
• B)It imposes fiscal discipline on countries,thereby reducing market activity.
• C)It increases demand for products and services thereby increasing productivity.
• D)It imposes monetary discipline by making governments set exchange rates.

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Definitions:

Cost Index

An index that measures the changes in the cost or price of specific goods or services over time.

FIFO Cost

FIFO, or First-In, First-Out, is an inventory valuation method where the costs of the earliest goods purchased or produced are the first to be recognized in determining cost of goods sold.

Dollar-Value LIFO

An inventory valuation method under Last-In, First-Out principle, adjusting for changes in price level or inflation, allowing for a more accurate financial analysis over time.

Inventory Items

Goods or products that a company holds for the ultimate purpose of sale, part of the current assets on a company's balance sheet.