If China Were to Adopt a Floating Exchange-Rate Regime, It

question 80

Multiple Choice

If China were to adopt a floating exchange-rate regime, it would:

• A) cause the Chinese trade balance to fall.
• B) cause the U.S. trade balance with China to fall.
• C) force the U.S. to adopt a fixed exchange rate to maintain the balance of trade.
• D) de-stabilize the entire world economy.

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Definitions:

Deoxygenated Blood

Blood that has released its oxygen to the body's cells and is returning to the heart to be sent to the lungs for oxygenation.

Umbilical Artery

One of two arteries that carry deoxygenated blood from a fetus to the placenta in the umbilical cord.

Ductus Arteriosus

A fetal blood vessel that connects the pulmonary artery to the aorta, allowing blood to bypass the lungs in utero, which normally closes after birth.

Foramen Ovale

An opening in the septum between the two atria of the heart in the fetus, which normally closes after birth.