Which of the following statement is FALSE?

It is difficult to maintain the peg when a country experiences major political or economic problems.

Most large developed countries such as the United States, the United Kingdom, Australia, Canada, and Japan combine government intervention with market forces to set exchange rates.

Dollarization (i.e., replacing the local currency with U.S. dollar) is a step further beyond the currency board because it forces the local currency to be replaced with the U.S. dollar.