If the Thai Baht Is Pegged Above the Equilibrium Exchange

question 95

Multiple Choice

If the Thai baht is pegged above the equilibrium exchange rate as expressed in US dollars per baht,

• A) the currency is undervalued.
• B) the currency is overvalued.
• C) there will be a shortage of the baht.
• D) the exchange rate between the baht and the US dollar is flexible.

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