Which of the following three goals that make up the policy trilemma can be achieved at the same time in the United States?
A) exchange rate stability and free capital flows
B) monetary policy independence and exchange rate stability
C) free capital flows and monetary policy independence
D) exchange rate stability, free capital flows, and monetary policy independence

Question

Quizplus · Accepted Answer

The United States is able to have both free capital flows and monetary policy independence due to the country's size and dominance in world markets. However, maintaining exchange rate stability in addition to these two goals would be difficult to achieve simultaneously.

Which of the Following Three Goals That Make Up the Policy