Under a managed-float exchange rates regime, if the rate of inflation in Australia is less than the rate of inflation of its trading partners, the AUD will likely: a. depreciate against foreign currencies. b. be officially devalued by the Reserve Bank. c. appreciate against foreign currencies. d. be officially revalued by the Reserve Bank
Under a managed-float exchange rates regime, if the rate of inflation in Australia is less than the rate of inflation of its trading partners, the AUD will likely: a. depreciate against foreign currencies. b. be officially devalued by the Reserve Bank. c. appreciate against foreign currencies. d. be officially revalued by the Reserve Bank
Chapter2: International Flow Of Funds
Section: Chapter Questions
Problem 5QA
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Question
Under a managed-float exchange rates regime, if the rate of inflation in Australia is less than the rate of inflation of its trading partners, the AUD will likely:
a.
depreciate against foreign currencies.
b.
be officially devalued by the Reserve Bank.
c.
appreciate against foreign currencies.
d.
be officially revalued by the Reserve Bank
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