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Problem 2. Fixed exchange rate systems. (8 points) Answer the following questions: a) What is the effect of country size on the choice of the
Problem 2. Fixed exchange rate systems. (8 points) Answer the following questions: a) What is the effect of country size on the choice of the exchange rate regime? What would a small country prefer? and a large country? b) In a xed exchange rate system, how do central banks address the problem of currency market pressures that threaten to lower or raise the value of their currency
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