A Country That Joins an Exchange Rate Area

question 14

Multiple Choice

A country that joins an exchange rate area

• A) gives up its ability to use the exchange rate for the purpose of stabilizing output and employment.
• B) does not give up its ability to use the exchange rate and monetary policy for the purpose of stabilizing output and employment.
• C) gives up its ability to use the exchange rate and monetary policy for the purpose of stabilizing output and employment.
• D) gives up its ability to use only monetary policy for the purpose of stabilizing output and employment.
• E) does not gives up its ability to use only monetary policy for the purpose of stabilizing output and employment.

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