Exchange Rates and the Balance of Payments (id: 9f6df488a)

本题目来源于试卷: Exchange Rates and the Balance of Payments，类别为 IB经济学

[单选题]
Which of the following is not a reason to adopt a floati vd2lqy:o tt e0toi(bk876 ly q.i1q0rng exchange utm )atc*n7 0;e+9lvgdsn6 xvrate?

A. The central bank has a low amount of foreign reserves
B. The central bank wants full freedom in setting interest rates
C. The government wants to ensure growth of the export sector
D. The government wants correct an external imbalance


参考答案:  C


本题详细解析:

C

$\underset{‾}{\text{Explanation}}$:
A government that wanted to develop its export sector would be inclined to have a fixed or managed exchange rate, as they could devalue the currency in order to make the country’s exports more competitive in foreign markets.

Choice A is incorrect, as a low amount of foreign exchange would inhibit a country's ability to manage its exchange rate, meaning the would have to adopt a floating exchange rate.

Choice B is incorrect as a floating exchange rate would grant central banks the freedom to pursue other goals as interest rates impact the exchange rate.

Choice D is incorrect as a floating exchange rate can correct an external imbalance, where the current account either has too high a deficit or surplus.

微信扫一扫，分享更方便