Suppose Brazil Has a Fixed Exchange Rate, and It Faces

Multiple Choice

Suppose Brazil has a fixed exchange rate, and it faces domestic recession and a trade surplus.Assuming it desires overall balance, if Brazil revalues its currency, other things equal one would expect which of the following to occur?

A) the recession to become less severe and the trade surplus to become less severe
B) the recession to become more severe and the trade surplus to become more severe
C) the recession to become more severe and the trade surplus to become less severe
D) the recession to become less severe and the trade surplus to become more severe