If a Country Sets a Pegged Exchange Rate That Is

question 192

Multiple Choice

If a country sets a pegged exchange rate that is below the equilibrium exchange rate,how can the country maintain the peg?

• A)by purchasing surplus domestic currency at the pegged rate
• B)by selling surplus domestic currency at the pegged rate
• C)by purchasing surplus domestic currency at the equilibrium exchange rate
• D)by decreasing the pegged exchange rate

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Definitions:

Reddish Dust

Fine, reddish particulate matter, often from desert areas, that can be transported long distances by wind.

Ice Caps

Large areas of ice that cover less than 50,000 square kilometers, generally found at high latitudes or elevations and differing from ice sheets.

Impact Craters

Depressions on the surface of a planet or moon created by the collision with another celestial body.

Tectonic Activity

The movement and interaction of Earth's lithospheric plates, which can cause earthquakes, volcanic eruptions, and the formation of mountains.