There is some evidence that adopting a pegged exchange rate regime _________________.
A) reduces unemployment in a country
B) moderates inflationary pressure in a country
C) increases global GNP
D) decreases global GNP
E) increases GNI growth within the country

Question

Quizplus · Accepted Answer

Adopting a pegged exchange rate regime can help to moderate inflationary pressure in a country by keeping the value of the currency relatively stable against other currencies. This can help to maintain price stability and prevent inflation from spiraling out of control. However, there is no evidence to suggest that a pegged exchange rate regime reduces unemployment or increases global GNP. Additionally, while it may contribute to GDP growth within a country, this is not the same as increasing GNI growth, which is a measure of the income earned by a country's residents.

There Is Some Evidence That Adopting a Pegged Exchange Rate