please do it in 10 minutes will upvote QUESTION 12Britain was on a fixed exchange rate in the early 1990's with Germany. Why did the reunification in Germany in the early 1990sand the resulting higher German interest rates cause a macroeconomic policy dilemma in BritainO Lower interest rates in Germany meant that Britain had to increase its money supply.O Lower interest rates in Germany meant that Britain had to cut its money supply.O Higher interest rates in Germany meant that Britain had to increase its money supply.Higher interest rates in Germany meant that Britain had to cut its money supplyNone of the above QUESTION 13Which of the following sets of two events would unambiguously increase the gains from creating a fixed exchange rate betweentwo countries?O The volume of trade between the countries increases and their business cycles become less synchronized.O The volume of trade between the countries increases and their business cycles become more synchronized.O The volume of trade between the countries decreases and their business cycles become less synchronized.O The volume of trade between the countries decreases and their business cycles become more synchronized.QUESTION 14Consider the case of a fixed exchange rate system as held in Europe before the Euro. All countries were fixed to Germany andcapital was mobileO Neither Germany nor the other countries have monetary policy autonomy.O The countries fixing to Germany have monetary policy autonomy while Germy does not.O Germany has monetary policy autonomy while the other countries do not.O All countries have monetary policy autonomy.QUESTION 15In terms of the exchange rate trilemma, under the Bretton Woods system from 1946 to 1973, countries:O maintained a fixed peg to the U.S. dollar, had monetary policy autonomy, but had to impose capital controls.O maintained a fixed peg to the U.S. dollar, eliminated capital controls, but had to sacrifice monetary policy autonomy.O had monetary policy autonomy, eliminated capital controls, but had to sacrifice a fixed peg to the U.S. dollar.O managed to implement all three policy options from the trilemma.

Question 12 The answer is - option a. Lower interest rates in Germany meant that Britain had to cut…

Britain was on a fixed exchange rate in the early 1990's with Germany. Why did the reunification in Germany in the early 1990s and the resulting higher German interest rates cause a macroeconomic policy dilemma in Britain O Lower interest rates in Germany meant that Britain had to increase its money supply. O Lower interest rates in Germany meant that Britain had to cut its money supply. O Higher interest rates in Germany meant that Britain had to increase its money supply. O Higher interest rates in Germany meant that Britain had to cut its money supply O None of the above

Britain was on a fixed exchange rate in the early 1990's with Germany. Why did the reunification in Germany in the early 1990s and the resulting higher German interest rates cause a macroeconomic policy dilemma in Britain O Lower interest rates in Germany meant that Britain had to increase its money supply. O Lower interest rates in Germany meant that Britain had to cut its money supply. O Higher interest rates in Germany meant that Britain had to increase its money supply. O Higher interest rates in Germany meant that Britain had to cut its money supply O None of the above

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter29: Exchange Rates And International Capital Flows

Section: Chapter Questions

Problem 25CTQ: If a countrys currency is expected to appreciate in value, what would you think will be the impact...

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