Rather than constructing their own currency baskets, many nations peg the value of their currencies to a currency basket defined by the International Monetary Fund.Which of the following is an example of this type of basket?
A) IMF tranche
B) special drawing rights
C) primary reserve asset
D) swap facility

Question

Quizplus · Accepted Answer

Special drawing rights (SDRs) are a type of currency basket defined by the International Monetary Fund (IMF) that many nations peg their currency value to. SDRs are a reserve asset used by countries to supplement their official reserves, and their value is based on a basket of currencies including the US dollar, euro, Chinese yuan, Japanese yen, and British pound.

Rather Than Constructing Their Own Currency Baskets, Many Nations Peg