To Maintain a Fixed Exchange Rate, the Government Can Use

question 65

Multiple Choice

To maintain a fixed exchange rate, the government can use the following tools, except

• A)currency market intervention.
• B)controlling the flow of trade through various barriers.
• C)rationing of foreign exchange.
• D)keeping its level of international reserves strictly fixed.

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Definitions:

Small Interest Group

A group of individuals or organizations that, despite its small size, seeks to influence public policy or corporate decisions based on specific common interests or concerns.

Inefficient Government Program

A public initiative that fails to achieve desired outcomes effectively, often due to misallocation of resources or administrative issues.

Logrolling

The practice of exchanging favors, especially in politics, by reciprocal voting for each other's proposed legislation.

Vote Trading

A strategy where individuals or parties exchange support for each other's preferred choices or policies, often seen in political contexts.