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  3. Study Set
    Macroeconomics Study Set 22
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    Exam 18: Exchange Rates and the Balance of Payments
  5. Question
    -Refer to the Above Diagram
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-Refer to the Above Diagram

Question 51

Question 51

Multiple Choice

  -Refer to the above diagram.The initial demand for and supply of pesos are shown by D<sub>1</sub> and S<sub>1</sub>.The exchange rate will be: A)  M dollars for one peso. B)  1/B pesos for one dollar. C)  A dollars for one peso. D)  C dollars for one peso.
-Refer to the above diagram.The initial demand for and supply of pesos are shown by D1 and S1.The exchange rate will be:


A) M dollars for one peso.
B) 1/B pesos for one dollar.
C) A dollars for one peso.
D) C dollars for one peso.

Correct Answer:

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