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The Weakness of the Dollar in the Late 1970s and the Strength

Question 1

Multiple Choice

The weakness of the dollar in the late 1970s and the strength of the dollar in the early 1980s can be explained by movements in


A) real interest rates, but not nominal interest rates.
B) nominal interest rates, but not real interest rates.
C) relative price levels, but not real interest rates.
D) none of the above.

Correct Answer:

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