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Author Question: Which of the following is NOT a potential disadvantage of a managed exchange rate? (Read 45 times)

rlane42

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Question 1

Which of the following policies could a government or central bank pursue to prevent the exchange rate from depreciating?
◦ Raise interest rates
◦ Buy foreign currencies on the foreign exchange market
◦ Increase the money supply through open-market operations
◦ Raise taxes

Question 2

Which of the following is NOT a potential disadvantage of a managed exchange rate?
◦ Possible speculation
◦ Inability to adjust to shocks
◦ Reduced uncertainty for exporting companies
◦ None of the above


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Marked as best answer by rlane42 on May 25, 2020

kardosa007

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rlane42

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Reply 2 on: May 25, 2020
Great answer, keep it coming :)


flexer1n1

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Reply 3 on: Yesterday
Excellent

 

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