______ can lead to inflation,which puts downward pressure on fixed exchange rates.
A) Monetary restrictions
B) Monetary standard
C) Sporadic trade balance adjustments
D) Monetary policy control
E) Monetary expansion

Question

Quizplus · Accepted Answer

Monetary expansion can lead to an increase in the supply of money, which can lead to inflation. When inflation occurs, the purchasing power of a currency decreases, putting downward pressure on fixed exchange rates.

______ Can Lead to Inflation,which Puts Downward Pressure on Fixed