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Balance-Of-Payments Adjustments

Question 2

Multiple Choice

Balance-of-payments adjustments


A) in a fixed exchange system, intervention does not change the money supply.
B) in a fixed exchange system, intervention changes the money supply.
C) in a fixed exchange system, does not change the relative prices of imports and exports between two trading countries.
D) in a floating exchange system, does not change through exchange-rate movements.
E) in a floating exchange system, internal prices do not remain stable.

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