Which of the Following Is a Key Feature of the Foreign

question 78

Multiple Choice

Which of the following is a key feature of the foreign exchange market?

• A)The foreign exchange market never sleeps.
• B)The foreign exchange market is located in London.
• C)The foreign exchange market is characterized by high transaction costs.
• D)The foreign exchange market is shut for two hours every day.
• E)The foreign exchange market is poorly interconnected giving rise to ample arbitrage opportunities.

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Definitions:

Keynesian Analysis

An economic theory that emphasizes the role government policies and spending should play in stabilizing the economy, maintaining low unemployment, and controlling inflation.

Aggregate Demand

The total demand for goods and services within a particular market.

Tax Cut

A reduction in the amount of taxes imposed by a government on its citizens.

Government Expenditures

Spending by the government sector including spending on goods and services, public works, and social programs.