An Advantage to Floating Exchange Rates Is That They Help

question 400

Multiple Choice

An advantage to floating exchange rates is that they help:

• A) insulate countries from currency fluctuations.
• B) insulate countries from recessions starting in other countries.
• C) keep exports from replacing domestic jobs.
• D) keep export prices down.

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Definitions:

APS

The Average Propensity to Save, which is the fraction of total income that households save rather than spend on consumption.

APC

Stands for Average Propensity to Consume, which is the fraction of income that households spend on consumption rather than saving.

APS

Automatic Payment System, a system allowing for automatic transfers of payments, often in financial contexts; the term can refer to multiple concepts depending on the context.

Savings

Money that is set aside from one's income or earnings for future use, often accumulating interest.