One Advantage of a Floating Exchange Rate System Compared to a Fixed

question 12

Multiple Choice

One advantage of a floating exchange rate system compared to a fixed or managed float exchange rate system is

• A) it is easier for central banks to control inflation.
• B) there is no need for government intervention.
• C) it allows greater exchange rate stability.
• D) it eliminates the possibility of depreciation during a recession.

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Definitions:

Service/Dedication

The act of committing oneself to a cause or service, often characterized by devotion and personal sacrifice.

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