Quiz 3 .docx - QUESTION 1 1 What is the name of the policy...

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QUESTION 1 1. What is the name of the policy aimed to lessen the need to monetize a government’s budget deficit by reducing the expenditures often with the unintended outcome of increased unemployment? austerity managed float target-zone arrangement fixed-rate system 1 points QUESTION 2 1. Managed floats do NOT fall into which of the following categories of central bank intervention? unofficial pegging leaning against the wind letting market forces set exchange rates smoothing out daily functions 1 points QUESTION 3 1. Calls for a new gold standard reflect a general willingness to accept fiat money a short memory of what actually transpired under the gold standard the durability and desireability of gold fundamental distrust of government's willingness to maintain the integrity of fiat money 1 points QUESTION 4 1. The current exchange rate system can best be characterized as a ___ system. hybrid free float managed float fixed-rate 1 points QUESTION 5 1. Under a fixedrate system, a country that followed policies that would lead to a higher rate of inflation than that experienced by its trading partners would see a decrease in the supply of its currency on the foreign exchange markets find its currency subject to upward pressure experience a balance-of-payments surplus as its goods became more expensive experience a balance-of-payments deficit as its goods became more expensive 1 points
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