Under the Fixed Rate Regime Foreign Countries Could Hold Their

question 117

Multiple Choice

Under the fixed rate regime foreign countries could hold their dollar exchange rates constant by

• A) using tight monetary policy.
• B) using expansionary fiscal policy.
• C) negotiating with the central bank of the United States.
• D) setting their domestic interest rate equal to the U.S. interest rate.
• E) holding their exchange rates constantly pegged to the euro and yen.

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Definitions:

Balance Sheet

A financial statement that displays a company's financial position at a specific point in time, listing assets, liabilities, and equity.

Final Entries

The journal entries recorded at the end of an accounting period to prepare accounts for the next period or for the preparation of financial statements.

Temporary Accounts

Accounts used to collect information during a specific accounting period and are closed at its end, such as revenues, expenses, and dividends accounts.

Journalizing

The process of recording a transaction in a journal.