Crawling Peg Is

question 36

Multiple Choice

Crawling peg is

• A)managed flexible exchange rate.
• B)a shock absorber.
• C)hedge against foreign exchange risk.
• D)an exchange rate arrangement in which a country pegs the value of its currency to the exchange value of another nation's currency but allows the par value to change at regular intervals.

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Definitions:

Interest Rates

The cost of borrowing money, expressed as a percentage of the amount borrowed, paid to the lender over a specified period.

Excess Supply

A situation where the quantity of a good or service provided is more than the quantity demanded at a given price.

Interest Rate

The cost, presented as a percentage of the principal amount, incurred by a borrower from a lender for asset use.

Interest-earning Assets

Financial assets that generate income through the payment of interest, such as savings accounts, bonds, and certificates of deposit.