The Advantage of a System of Fixed Exchange Rates Over

question 5

Multiple Choice

The advantage of a system of fixed exchange rates over one where exchange rates are flexible is that

• A)the government gains more control over the economy.
• B)floating exchange rates impose risks on importers and exporters from unpredictable exchange rates.
• C)exchange controls become unnecessary.
• D)fiscal and monetary policy can focus more on domestic conditions.

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Definitions:

True Null Hypothesis

The hypothesis that there is no effect or no difference, and it truly reflects the reality in the population sampled.

Rejecting

In statistics, it often refers to the act of discarding the null hypothesis based on the evidence of a test.

Type I Error

A Type I error occurs when a true null hypothesis is incorrectly rejected, often denoted as a false positive in hypothesis testing.

Null Hypothesis

A statement used in statistics that proposes there is no significant difference or effect.