The Belief That Shifts in Exchange Rates Result from Increasing

question 15

Multiple Choice

The belief that shifts in exchange rates result from increasing or decreasing demand for a country's exports (or the corresponding opposite movements in supply of a country's imports) form the basis for the

• A) purchasing power theory of exchange rates.
• B) interest rate parity theory of exchange rates.
• C) balance of payments theory of exchange rates.
• D) government intervention theory of exchange rates.

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