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From course:

Economics A Level (DONEEEEEEE)

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Question:

What are the Disadvantages of a Fixed Exchange Rate?

Author: eric_galvao



Answer:

-If the Fixed Exchange Rate is no longer suitable, they may start Speculating, Sell the Currency, and make the situation Less Suitable -Nation loses Control of Interest Rates, as they need to be Used to keep the Rate at the Desired Level -Can be Difficult and Expensive to Maintain


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