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Why Would a Country Adopt Floating Exchange Rates

Question 64

Multiple Choice

Why would a country adopt floating exchange rates?


A) Floating exchange rates allow a government the freedom to pursue its own monetary policies.
B) A floating exchange rate reduces the likelihood of abrupt changes in currency values.
C) Floating exchange rates are beneficial for borrowers of foreign funds.
D) Floating exchange rates make international trade less risky.
E) Floating exchange rates make international travel more convenient.

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