2. Explain the mechanism of managed floating exchange rate regime. What are the differences of this regime from flexible and fixed exchange rate regimes. Please describe its equation. According to following table what would be the exchange rate in the period t+1 if the Central Bank did not buy foreign currency and did not accumulate FX reserves. Time t t+1 CA -$30,000 FA $50,000 Change in IR Negative value indicates an increase in reserves -$10,000 Exchange Rate 1 = $0,20 1 = $0,25