Fixed exchange rates provide a more predictable basis for decisions involving international transactions by ensuring that the value of currencies remains stable over a certain period of time. This makes it easier for businesses and individuals to plan and budget for their transactions. Additionally, fixed exchange rates can reduce the risk of currency fluctuations causing uncertainties in trade and investment.

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A Major Economic

Question 37

Multiple Choice

A major economic

A) benefit of fixed exchange rates is that they simplify economic calculations and provide a more predictable basis for decisions that involve international transactions than do floating rates.
B) benefit of floating exchange rates it that they simplify economic calculations and provide a more predictable basis for decisions that involve international transactions than do fixed rates.
C) cost of fixed exchange rates it that they simplify economic calculations and provide a more predictable basis for decisions that involve international transactions than do currency board rates.
D) benefit of flexible exchange rates it that they simplify economic calculations and provide a more predictable basis for decisions that involve international transactions than do crawling peg rates.
E) benefit of fixed exchange rates is that the value of goods will remain constant across a large region of consumers.

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