A Cost-Benefit Analysis Can Be Done to Assess Whether a Nation

question 21

Multiple Choice

A cost-benefit analysis can be done to assess whether a nation should fix its exchange rate. Which of the following is NOT correct?

• A) If market integration or symmetry increase, then the net benefits of a fixed exchange rate increase.
• B) If the net benefits are negative, economically speaking the nation should float.
• C) If the net benefits are positive, economically speaking the nation should float.
• D) If the net benefits turn negative, the nation should fix.

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Definitions:

Sell the Franchise

The act of transferring ownership of a franchise from one individual or entity to another, often involving a contractual agreement.

Franchise Contract

A legal agreement between a franchisor and franchisee that allows the franchisee to operate a business under the franchisor's brand and system in exchange for fees or royalties.

Exclusive Territorial Rights

Rights granted to a party to be the sole provider or seller of a product or service within a specific geographical area.

Antitrust Laws

Legislation designed to promote competition and prevent monopolies by regulating anti-competitive conduct among companies.