If the Portfolio Balance Approach Is True Then Which of the Following

question 9

Multiple Choice

If the portfolio balance approach is true then which of the following will directly lead to changes in the exchange rate?

• A) A monetary policy announcement
• B) A fiscal policy announcement
• C) A shift in the demand for foreign bonds
• D) A shift in the relative cost of a substitute currency

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Definitions:

Oceanic Nations

Refers to countries primarily located in the Pacific Ocean, which may share certain cultural, historical, and geopolitical characteristics or challenges.

Goal Sharing

The practice of communicating and aligning individual goals with those of a group or team to enhance cooperation and achieve mutual objectives.

Authority Ranking

A type of social hierarchy where individuals are ranked according to power or status, with higher-ranking individuals having authority over those lower in the hierarchy.

Market Pricing

A social exchange theory concept where relationships are evaluated based on cost-benefit analysis and equitable distribution.