To fix its exchange rate, a government can use:

Name: To fix its exchange rate, a government can use:
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Exchange market intervention, also known as an active exchange rate policy, involves the government using its own financial resources or policies to influence the exchange rate. This can be done through buying or selling foreign currency, setting interest rates, or imposing capital controls. Competition, speculation, and arbitrage are not methods used by governments to fix exchange rates.

To Fix Its Exchange Rate, a Government Can Use