Which of the following exchange rate policies uses a target exchange rate, but allows the target to change?
A)crawling peg
B)flexible exchange rate
C)fixed exchange rate
D)moving target
E)flexible target exchange rate

Question

Quizplus · Accepted Answer

A crawling peg exchange rate policy involves setting a target exchange rate and allowing it to change over time based on a set of predetermined factors. This differs from a fixed exchange rate policy where the exchange rate is set and held constant, or a flexible exchange rate policy where the exchange rate is determined by market forces. Therefore, the crawling peg exchange rate policy fits the description given in the question.

Which of the Following Exchange Rate Policies Uses a Target