Exchange Rates

Answer these questions:

  1. What are the advantages and disadvantages of a fixed exchange rate?
  2. What are the advantages and disadvantages of a floating exchange rate? 3. Under what conditions might it be a good idea for a country to adopt a gold standard?

Go online to find a news article that describes an example of a country that has changed its system from fixed to floating or from floating to fixed. Write a paragraph to summarize your responses.
You must restrict your search to primary sources e.g. government sites or academic sites (.gov or .edu) or current events articles (published by reputable news outlets) and provide your own analysis. Steer clear of sites like balance.com/about.com, investopedia.com, amosweb.com, economicshelp.org, etc.

Sample Solution

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