CFA Practice Question

There are 341 practice questions for this study session.

CFA Practice Question

Under a system of fixed exchange rates, an upward revaluation of a nation's currency would ______
A. tend to cause an increase in exports.
B. tend to cause an increase in imports.
C. not be permitted.
Explanation: The higher value of the domestic currency would make foreign goods and services less expensive and would increase imports. Under fixed-rate systems, changes are made by the governing authority rather than taking place freely in markets.

User Contributed Comments 0

You need to log in first to add your comment.