Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Open Economy Macro Economics

Question:

Arrange the following statements in correct sequence relating to change in exchange.

(A) The Central Bank intervenes to purchase dollars rate between Dollars and Rupee in the foreign exchange market.

(B) The government sets the exchange rate above the equilibrium exchange rate.

(C) This will absorb the excess supply of dollars in the foreign exchange market.

(D) It will result in excess supply of dollars in the foreign exchange market.

Choose the correct answer from the options given below :

 

Options:

(B), (D), (A), (C)

(D), (C), (B), (A)

(C), (D), (A), (B)

(A), (B), (C), (D)

Correct Answer:

(B), (D), (A), (C)

Explanation:

The correct answer is option (1) : (B), (D), (A), (C)