To maintain a ﬁxed exchange rate, the government can use the following tools, except

Question

Quizplus · Accepted Answer

To maintain a fixed exchange rate, a government can intervene in currency markets, control trade flows, and ration foreign exchange. However, keeping international reserves strictly fixed is not a method for maintaining a fixed exchange rate; instead, adjusting reserves is a tool used in the process of managing the exchange rate.

To Maintain a ﬁXed Exchange Rate, the Government Can Use