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Each of the Following Is a Cost of a Floating

Question 42

Multiple Choice

Each of the following is a cost of a floating exchange rate system except


A) governments break the contracts they made with investors in foreign countries.
B) international trade is discouraged due to increased exchange rate risk.
C) political turmoil is avoided by floating exchange rate systems.
D) exporters and firms whose products compete with imported goods never know what their competitors' costs are going to be.

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