If China Wished to Reduce Their Accumulation of Foreign Exchange

question 19

Multiple Choice

If China wished to reduce their accumulation of foreign exchange reserves they could:

• A) allow their currency, the yuan, to float freely in the market place.
• B) reduce their current account surplus by importing more goods than they export.
• C) undertake both of the activities identified in choices A and B.
• D) dig a big hole and bury the reserves.

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Definitions:

Naturalistic Intelligence

A type of intelligence proposed by Howard Gardner, relating to how well an individual can understand and interact with the natural world.

Spatial Intelligence

The ability to visualize with the mind's eye, relating to the capacity to think about objects in three dimensions and to make inferences about those spatial relationships.

Cognitive Label

A term in psychology that refers to the cognitive process of identifying and interpreting emotional experiences through attached labels.

Emotional Experience

Emotional experience encompasses the wide range of feelings, moods, and emotions that an individual can have, and involves the subjective interpretation and physiological response to external and internal stimuli.