If a country wants maximum flexibility to pursue its domestic macroeconomic goals, it:
A)does not matter what type of exchange rate system it uses.
B)should use a flexible exchange rate.
C)should use a fixed exchange rate.
D)should use the gold standard.

Question

Quizplus · Accepted Answer

A flexible exchange rate system allows a country to have an independent monetary policy, which provides more flexibility to pursue its domestic macroeconomic goals, such as controlling inflation, unemployment, and economic growth, without the need to maintain its currency value relative to another currency or commodity.

If a Country Wants Maximum Flexibility to Pursue Its Domestic