Under Fixed Exchange Rates, Which One of the Following Statements

Multiple Choice

Under fixed exchange rates, which one of the following statements is the MOST accurate?

A) Devaluation causes a reduction of the money supply.
B) Devaluation has no effect on the stock of money.
C) Devaluation causes an expansion of the money supply.
D) Devaluation causes a reduction in output.
E) Devaluation causes a reduction in official reserves.