With fixed exchange rates,a country cannot conduct ________ to alter domestic income.
A) Fiscal policy
B) Monetary policy
C) Currency devaluations
D) Currency appreciation

Question

Quizplus · Accepted Answer

With fixed exchange rates, a country's ability to use monetary policy as a tool to influence domestic income is significantly limited. This is because the central bank must focus on maintaining the fixed exchange rate, often by adjusting interest rates to control money flow, which restricts its ability to use monetary policy for domestic economic stabilization.

With Fixed Exchange Rates,a Country Cannot Conduct ________ to Alter