Multiple Choice
The macroeconomic policy trilemma regarding exchange rate policies is that monetary authorities
A) cannot pursue independent monetary policy while maintaining fixed exchange rates and allowing free capital movement.
B) maintain fixed exchange rates while pursuing an independent monetary policy and allowing free capital movement.
C) allow free capital movement while pursuing an independent monetary policy and maintaining fixed exchange rates.
D) all of the above.
E) none of the above.
Correct Answer:
Verified
Correct Answer:
Verified
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