A country has experienced a rapid and unpredictable change in the value of its currency in recent years. Its leaders decide that the country needs to adopt a new system that will make it easier to predict changes in the currency's value from month to month. The leaders decide to tie the country's currency to the price of gold. If gold becomes more expensive, the country's currency will increase in value. If gold becomes cheaper, the currency will fall in value.Which sentence best describes the system the country has created?A.The country has a trade-weighted exchange rate.B.The country has set up a fixed exchange rate.C.The country has set up a flexible exchange rate.D.The country has gotten rid of its exchange rate.

Which outcome is the most likely result of a country's currency becoming more valuable over time?A.The country will need to adopt a fixed exchange rate to help its economy grow.B.The country will need to adopt a flexible exchange rate to stabilize its economy.C.The country will be able to import more goods without spending more money.D.The country will be forced to export more goods to make up for increased imports.

A country wants to make sure that its economy remains stable. Its leaders worry that allowing market forces to increase or decrease the value of the country's currency could lead to instability and disrupt economic growth. As a result, the country decides to tie the value of its currency directly to the U.S. dollar. If the dollar becomes more valuable, the country's currency will increase in value. If the dollar declines, the country's currency will decline as well.This economic situation is an example of a:A.trade-weighted exchange rate.B.deficit-weighted exchange rate.C.flexible exchange rate.D.fixed exchange rate.

Two countries trade with each other regularly. Country A has a strong economy and buys large quantities natural resources from country B each year. Country B has a weaker economy, and $1 in country A's currency is worth about $50 in country B's currency.Which development would most likely result in country B's economy growing stronger?A.Country B's exchange rate becomes fixed, while country A's becomes flexible.B.The exchange rate changes to $1 of country A's money for $20 of country B's money.C.Country A's exchange rate becomes fixed, while country B's becomes flexible.D.The exchange rate changes to $1 of country A's money for $75 of country B's money.

A country that sets the value of its currency based on the value of another world currency has a(n) _____ exchange rate.A.flexibleB.inflatedC.fixedD.trade-weighted

Country A noticed that its currency had slowly fallen out of sync with its economy. Due to an increase in exports, its currency’s value has been appreciating, making it difficult for other countries to afford the goods it produces. Which of the following institutions would intervene in such a situation?The World Trade OrganisationThe International Monetary FundThe Central Bank