Critics of floating exchange rates claim that trade deficits are deter

QUESTION

Critics of floating exchange rates claim that trade deficits are determined by the:

A. balance between savings and investment in a country.

B. external value of the currency of a country.

C. exchange rates of other currencies.

D. valuations made by International Monetary Fund and the World Bank.

E. mechanism of competitive currency devaluation.

ANSWER

A