Which of the goals pursued by policymakers in an open economy is desirable because it reduces the uncertainty of conducting economic activity across borders?
A) exchange-rate stability
B) monetary policy independence
C) free capital flows
D) appreciation of the domestic currency

Question

Quizplus · Accepted Answer

Exchange-rate stability reduces uncertainty for businesses by providing a predictable currency exchange rate for importing and exporting goods and services across borders. This helps to facilitate trade and investment and encourages economic activity in an open economy.

Which of the Goals Pursued by Policymakers in an Open