The Advantage of a Fixed Exchange Rate Is That It

question 78

Multiple Choice

The advantage of a fixed exchange rate is that it:

• A) leaves monetary policy available for macroeconomic stabilization.
• B) eliminates the possibility of the twin deficits.
• C) eliminates uncertainty about the value of a currency.
• D) tends to create trade surpluses.

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Definitions:

Pluralist Theory

Holds that power is widely dispersed. As a result, no group enjoys disproportionate influence, and decisions are usually reached through negotiation and compromise.

Heterogeneous Society

A community made up of individuals from diverse backgrounds, cultures, ethnicities, or beliefs.

Competing Interests

Situations where multiple parties have conflicting objectives, goals, or desires.

Sociological Theory

A framework for understanding society that analyzes the relationships between individuals, groups, institutions, and societies.