Question :
101.Which of the following has some aspects of the pre-1973 : 1299399
101.Which of the following has some aspects of the pre-1973 Bretton Woods exchange rate system?
A. Pure “free float” exchange rate system
B. Dirty float exchange rate system
C. Nominal exchange rate system
D. Pegged exchange rate system
E. Real exchange rate system
102.A(n) _____ system refers to an exchange rate system under which a country’s exchange rate is allowed to fluctuate against other currencies within a target zone.
A. free float
B. fixed peg
C. adjustable peg
D. pure float
E. capital float
103.An advantage of a pegged exchange rate system is that it imposes monetary discipline on a country and leads to low _____.
A. monetary discipline
B. price inflation
C. exchange rate predictability
D. trade surplus
E. exports
104.Which of the following holds true for a pegged exchange rate system?
A. Adopting a pegged exchange rate regime increases inflationary pressures in a country.
B. It is necessary for a country whose currency is chosen for the peg to pursue a sound monetary policy.
C. Pegged exchange rates are popular among many of the world’s largest and developed nations.
D. The value of a pegged currency falls when the reference currency rises in value.
E. It is similar to a floating exchange rate system rather than a fixed system.
105.It has been shown that adopting a _____ exchange rate regime moderates inflationary pressures in a country.
A. nominal
B. pegged
C. pure “free float”
D. clean float
E. real
106.A country that introduces a _____ commits itself to converting its domestic currency on demand into another currency at a fixed exchange rate.
A. free float exchange rate system
B. clean float exchange rate system
C. pure float exchange rate system
D. currency board
E. gold standard
107.How does a country that introduces a currency board make its commitment to converting its domestic currency on demand into another currency at a fixed exchange rate credible?
A. By borrowing funds from the International Monetary Fund and the World Bank
B. By maintaining a trade surplus with the foreign countries
C. By holding foreign currency reserves equal at the fixed exchange rate to at least 100 percent of the domestic currency issued
D. By importing more goods from foreign countries than it exports
E. By printing foreign currencies
108.Which of the following statements is true about a currency board system?
A. Under a strict currency board system, interest rates adjust automatically based on the supply and demand of domestic currency.
B. To convert domestic currency on demand into another currency, a currency board takes grants from the International Monetary Fund.
C. This system is a true fixed exchange rate regime, because the domestic currency is fixed against other currencies.
D. A currency board can issue additional domestic currency even when there are no foreign exchange reserves to back it.
E. A currency board authorizes the government to print money and set interest rates.
109.During the 1997 Asian currency crisis, the currency board of _____ maintained the value of its currency against the U.S. dollar.
A. Japan
B. Taiwan
C. Hong Kong
D. Indonesia
E. China
110.Which of the following is a drawback of the currency board system?
A. The ease with which governments can set and manipulate interest rates acts as a limitation.
B. Higher domestic inflation rates compared to the inflation rate in the country to which the currency is pegged can make the currency uncompetitive.
C. The currency board can issue additional domestic notes and coins even when there are no foreign exchange reserves to back it.
D. The system is a true fixed exchange rate regime, because the domestic currency is fixed against other currencies.
E. The system lacks commitment to convert domestic currency on demand into another currency.
