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Question 33 Which one is the advantage of a Fixed Exchange Rate of currencies? It provides
economic stability and encourage investment It helps to keep inflation at low level a and b there
is no known benefit of fixed exchange rate as such
Solution
Advantages of fixed exchange rate:
1 Investment: A stable exchange rate gives incentive to invest in export capacity.
2 Low inflation
So option (c) is correct.

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  • 1. Question 33 Which one is the advantage of a Fixed Exchange Rate of currencies? It provides economic stability and encourage investment It helps to keep inflation at low level a and b there is no known benefit of fixed exchange rate as such Solution Advantages of fixed exchange rate: 1 Investment: A stable exchange rate gives incentive to invest in export capacity. 2 Low inflation So option (c) is correct.