Proponents of a Freely Floating Exchange Rate System Maintain That

question 103

Multiple Choice

Proponents of a freely floating exchange rate system maintain that it is superior to a fixed exchange rate system because

• A) the balance of payments adjusts continuously to exchange-rate movements
• B) governments can establish independent monetary and fiscal policies
• C) disorderly exchange rate movements can disrupt trade and investment patterns
• D) floating exchange rates operate under simplified institutional arrangements

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Definitions:

Fiduciary Duty

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Proper Name

A specific reference to a unique individual, place, or thing, typically starting with a capital letter and used to give identity.

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