Which of the Two Features of the IMF Articles of Agreement

question 15

Multiple Choice

Which of the two features of the IMF Articles of Agreement helped promote flexibility in external adjustment?

• A) IMF members helped countries maintain full employment.
• B) IMF allowed countries to attain internal balance.
• C) New countries would enter the agreement if they fixed their exchange rate.
• D) IMF members contributed their currency to form a pool of resources that IMF could lend to countries in need and parities in the exchange rate against the dollar could be adjusted with agreement of IMF.
• E) IMF members argued against the use of floating exchange rates.

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Definitions:

Social Learning

A theory that suggests people learn new behaviors and acquire new information by observing and mimicking others, as well as through direct instruction.

Cognitive Dissonance

The mental discomfort experienced by a person who holds two or more contradictory beliefs, ideas, or values at the same time, leading to an alteration in one of the attitudes, beliefs, or behaviors to reduce the discomfort and restore balance.

Competitive Inertia

A situation where a company continues with its current strategies because it has historically been successful, even when those strategies become less effective.

Affect

A term referring to the experience of feeling or emotion in psychology.