Which of the following is an advantage of fixing exchange rates?
A) limiting foreign exchange risk
B) making residents more mobile across countries
C) eliminating trade deficits
D) making the prices of foreign goods more flexible in the domestic market

Question

Quizplus · Accepted Answer

Fixing exchange rates can limit foreign exchange risk for businesses and investors who need to know the exact value of currency when making decisions. This can help to stabilize international trade and investment. However, it may also limit the ability to adjust to changes in the global economy.

Which of the Following Is an Advantage of Fixing Exchange