The System in Which the Country Pegs Its Currency at a Fixed

question 35

Multiple Choice

The system in which the country pegs its currency at a fixed rate to a major currency or basket of currencies,while the exchange rate fluctuates within a narrow margin around a central rate is called a(n) _____.

• A) spot market
• B) fixed exchange rate system
• C) independent floating exchange rate system
• D) managed floating exchange rate system
• E) foreign exchange market

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Definitions:

Maximum Satisfaction

The highest level of satisfaction or utility achieved by a consumer through the consumption of goods and services.

Economic Principles

Fundamental theories and concepts that underpin the study of economics, guiding the analysis of economic behavior.

Value Judgments

Assessments or opinions based on personal values, ethics, or tastes, rather than objective data.

Positive Economic Statement

An objective statement that can be tested or validated and is based on factual information.