A Central Bank May Be Reluctant to See Its Currency

question 55

Multiple Choice

A central bank may be reluctant to see its currency appreciate because

• A)rising prices of imports will contribute to inflation.
• B)falling prices of exports will contribute to inflation.
• C)the country's goods may become uncompetitive in world markets.
• D)the country's monetary base will increase.

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Definitions:

Desired Profit

The target amount of net income that a company aims to achieve in a specific period.

Value-Based Pricing

Pricing strategy where the selling price is determined by estimating the product's or service's value to the customer rather than its cost of production or market competition.

Preventive Maintenance

Routine maintenance and inspections carried out to prevent potential problems or failures before they occur.

Useful Life

The estimated period of time over which an asset is expected to be usable by the entity, after which it may no longer be economically beneficial to keep.