Multiple Choice
If a country is experiencing chronic deficits on current account, what must ultimatelyhappen to its exchange rate?
A) it must appreciate
B) it must depreciate
C) the market will shift it from floating to fixed
D) it pursues lower interest rates than those in other countries
E) it will become equalized, that is, the same rate as in other countries
Correct Answer:
Verified
Correct Answer:
Verified
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