An Exchange Rate Target Zone Is

question 61

Multiple Choice

An exchange rate target zone is

• A)a range of floating exchange rates.
• B)a range of permitted exchange rate variations between upper and lower exchange rates bands that a central bank defends by selling or buying foreign exchange reserves.
• C)a range of fixed exchange rates.
• D)a range of dirty floats.

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Definitions:

Government Imposes

The act of the government enacting regulations, taxes, restrictions, or laws that directly affect business practices, individual behavior, or market operations.

Shrimp Market

A specialized market segment dealing with the buying and selling of shrimp for consumption.

Price Floor

A government or regulatory imposed minimum price for a good or service, aimed to prevent the market price from falling below a certain level.

Quota

A government-imposed limit on the quantity of a particular good that can be imported or exported.