The Figure Given Below Depicts the Foreign Exchange Market for British

question 26

Multiple Choice

The figure given below depicts the foreign exchange market for British pounds traded for U.S. dollars.Figure 22.2

-A permanent shift in the foreign exchange market supply and demand curves such that the fixed exchange rate is no longer an equilibrium rate is referred to as:

• A)permanent devaluation.
• B)speculative disequilibrium.
• C)permanent revaluation.
• D)speculative equilibrium.
• E)fundamental disequilibrium.

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Definitions:

Recessionary Economy

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Boom Economy

A phase of economic expansion characterized by rapid growth, increased production, and elevated consumer spending.

Variance

A measure of the dispersion or spread of a set of data points around their mean value; in finance, it's often used to measure volatility.

Portfolio Variance

A measure of the dispersion of returns of a portfolio's assets, indicating the degree of investment risk.