The crux of the dilemma is that under fixed exchange rates, countries are limited in running their own _______ policies because of the need to maintain the value of their currency.
A)monetary
B)fiscal
C)tax
D)fiscal and tax

Question

Quizplus · Accepted Answer

Fixed exchange rates limit a country's ability to pursue its own monetary policies because they must maintain the value of their currency relative to other currencies. Fiscal and tax policies are not directly affected by fixed exchange rates.

The Crux of the Dilemma Is That Under Fixed Exchange