Even Though It May Seem That Nations Have a Wide

Multiple Choice

Even though it may seem that nations have a wide variety of policy options to stabilize their economies, there are a number of issues to be considered and overcome. Which of the following is NOT an issue confronting policy makers?

A) the desire to maintain fixed exchange rates or membership in a pegged currency bloc
B) long and uncertain time lags when policy effects will occur
C) the pass-through issue, when little effect occurs on the real effective exchange rate
D) international controls that limit the ability of any nation to determine its exchange rate policy