Twelve years ago and again five years
ago, there were extended periods when the Darfir Republic's currency, the
pundra, was weak: its value was
unusually low relative to the world's most stable currencies. Both times a weak pundra made Darfir's
manufactured products a bargain on world markets, and Darfir's exports were up
substantially. Now some politicians are
saying that, in order to cause another similarly sized increase in exports, the
government should allow the pundra to become weak again.
Which of the following, if true, provides the
government with the strongest grounds to doubt that the politicians'
recommendation, if followed, will achieve its aim?
(A) Several of the politicians now recommending
that the pundra be allowed to become weak made that same recommendation before
each of the last two periods of currency weakness.
(B) After several decades of operating well below
peak capacity, Darfir's manufacturing sector is now operating at near-peak
levels.
(C) The economy of a country experiencing a rise
in exports will become healthier only if the country's currency is strong or
the rise in exports is significant.
(D) Those countries whose manufactured products
compete with Darfir's on the world market all currently have stable currencies.
(E) A sharp improvement in the efficiency of
Darfir's manufacturing plants would make Darfir's products a bargain on world
markets even without any weakening of the pundra relative to other currencies.
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