illat tends to manipulate imports and exports of the economy. It controls the level of money supply in its desired level through export and import. Importation of goods and services from abroad drain funds away from the circular flow. Exports constitutes increase in funds. Exchange rate regimes-flexible exchange rates-determine by the demand and supply of dollars. If there are more dollars offered for sale in the market than demanded at a given price, the exchange rate goes down, however, if there are more dollars demanded than dollars for sale, the exchange rate goes up. Reflection and Analysis How the Economic policies will regulate the inflows and outflows of money in our system