Which of the following arguments is against the use of fixed exchange rates?
A) Monetary discipline is the most important determinant of a strong economy.
B) Each country has the freedom to choose its own inflation rate.
C) Market speculation can cause fluctuations in exchange rates.
D) Governments are likely to expand the monetary supply far too rapidly due to political pressures.

Question

Quizplus · Accepted Answer

Advocates of floating rates argue that each country should be allowed to choose its own inflation rate. This is called the monetary autonomy argument.

Which of the Following Arguments Is Against the Use of Fixed