Imagine a world of 3 currencies on a fixed exchange rate regime.The exchange rates are $1NZ = 60 = 4.Suppose that the $NZ is devalued by 20% with respect to the yen only.What transactions would holders of $NZ assets make?

a.

Change $NZ into euros then into yen then into $NZ again.

b.

Change $NZ into yen then into euros then into $NZ again.

c.

Change $NZ into yen and then back to $NZ again.

d.

Hold their $NZ assets to avoid further losses on the exchange rate.