Under a fixed exchange rate regime,a country that depletes its international reserves in an attempt to keep its currency from ________ will be forced to ________ its currency.

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Under a fixed exchange rate regime, a country cannot let its currency depreciate without intervention. Therefore, if a country depletes its international reserves in an attempt to keep its currency from depreciating, it will be forced to devalue its currency. Devaluation means reducing the value of the currency in relation to other currencies, which will make exports cheaper and increase the competitiveness of the country's goods in foreign markets.

Under a Fixed Exchange Rate Regime,a Country That Depletes Its