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Advocates of the Fixed Exchange Rate System Argue All of the Following

Question 50

Multiple Choice

Advocates of the fixed exchange rate system argue all of the following except one.Which is the exception?


A) Fixed exchange rates are not vulnerable to the actions of speculators.
B) Fixed exchange rates introduced greater future certainty into trading which will increase the volume of international trade.
C) Fixed exchange rates are able to adjust rapidly so as to attract foreign investment.
D) With fixed exchange rates,export and import industries do not suffer severe and unpredictable fluctuations in business.
E) The certainty that comes from fixed exchange rates increases the volume of international investment.

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