Which of the following is true for an economy that has adopted a ﬁxed exchange rate regime?

Question

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In a fixed exchange rate regime, a country's central bank may intervene in the foreign exchange market to maintain the pegged rate, which can lead to imbalances in the balance of payments. The balance of payments might not always equal zero because the central bank may need to use its reserves to buy or sell the domestic currency to keep its value fixed relative to another currency or a basket of currencies.

Which of the Following Is True for an Economy That