GK
ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The exchange rate system that best characterizes the present international monetary arrangement used by industrialized countries is
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pegged or fixed exchange rates
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freely fluctuating exchange rates
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managed floating exchange rates
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adjustable pegged exchange rates
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Explanation:
Detailed explanation-1: -With a dirty float, the exchange rate is allowed to fluctuate on the open market, but the central bank can intervene to keep it within a certain range, or prevent it from trending in an unfavorable direction. Dirty, or managed floats are used when a country establishes a currency band or currency board.
Detailed explanation-2: -An exchange rate regime is a way a monetary authority of a country or currency union manages the currency about other currencies and the foreign exchange market.
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