Which of the following is one of the usual policy changes included in an IMF prescription?
A. Temporary cartels in domestic product markets.
B. Changes in fiscal policy to reduce the government budget deficit.
C. Increased barriers to imports.
Decreased regulation of public sector enterprises.
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Which of the following contributed to the Asian Crisis?
A. The strong capital inflows from the industrialized countries mainly provided financing for large fiscal deficits in the South East Asian countries.
B. The currencies of most of the Asian countries were substantially undervalued.
C. The Hong Kong dollar was allowed to depreciate.
D. The local borrowers in the Asian countries scrambled to sell local currency to establish hedges against exchange rate risks.
Beginning in about 1990, lending to and investing in developing countries began to increase. One explanation for this is that:
A. Interest rates in the United States began to rise.
B. The governments in the developing countries began to encourage import-substituting manufacturing.
Changes in IMF policies toward exchange rate risk.
Deregulation and privatization in the developing countries opened up profitable new investment opportunities.
The 1982 debt crisis was caused in part by:
A. Falling world interest rates.
B. A rapid increase in cheap imports from developing countries.
C. Falling developing country exports and high real interest rates.
D. Rising commodity prices.
Which crisis was resolved by the help of the Brady Plan?
A. The 1997 currency crisis.
B. The 1982 debt crisis.
C. The 1991 global recession.
D. The European debt crisis.