One Argument Favoring a Fixed-Exchange-Rate System Is That It

question 23

Multiple Choice

One argument favoring a fixed-exchange-rate system is that it:

• A) allows monetary policy to be used for stabilizing output and prices.
• B) reduces exchange-rate uncertainty, thereby promoting more international trade.
• C) leads to excessive growth of the money supply.
• D) requires no actions on the part of the central bank to implement.

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Definitions:

Vaccine

A biological preparation that provides active acquired immunity to a particular infectious disease, often containing agents that resemble the disease-causing microorganism.

Phenomenon

An observable event or fact that is often remarkable or unusual, studied across scientific and philosophical fields.

Acute Infections

Infections that have a rapid onset and typically a brief duration, often leading to noticeable symptoms and requiring immediate treatment.

Chronic Infections

Long-term infections that persist for months or years, often due to the inability of the immune system to clear the pathogen.