Which of the following is incorrect?
A)Overall, floating exchange-rates discipline countries to have low inflation rates.
B)With fixed exchange-rates, a country that prefers to have a lower inflation rate than its trading partners will tend to import inflation from its partners.
C)Floating exchange-rates permit countries to have different inflation rates.
D)Since 1973, high degrees of variability of floating exchange-rates may have caused considerable adjustment into or out of trade-oriented production from time to time.

Question

Quizplus · Accepted Answer

Floating exchange rates do not inherently discipline countries to have low inflation rates. They allow for exchange rates to adjust to market conditions, which can accommodate varying inflation rates without directly enforcing monetary discipline.

Which of the Following Is Incorrect