The tremendous international mobility of financial capital is forcing emerging market nations to adopt one of two polarized choices, free float or currency board, for their foreign currency exchange regimes. Which of the following would NOT be a reason for an emerging nation to choose to have their currency freely float?
A) The country desires to lose political influence on the valuation of their currency.
B) The emerging nation desires an independent monetary policy.
C) The emerging nation is willing to tradeoff exchange rate stability to gain free movement of capital.
D) All of the above.
Correct Answer:
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