One of the Important Disadvantages of a Crawling Peg System

question 35

Multiple Choice

One of the important disadvantages of a crawling peg system is

• A)there is not enough gold to exchange for currency when citizens demand gold from the central bank in exchange for bank notes.
• B)it works too well.
• C)the official exchange rate does not change as often as it should because government bureaucracy does not react fast enough to changing economic conditions.
• D)economic conditions become too stable.

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