What is meant by soft exchange rate pegs?
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What is meant by Hard exchange rate pegs?
What is a trade-off in exchange rate pegs?
2.
a) When a currency depreciates on the international market, what impacts does that have domestically?
b) What advantages does a nation have if it pegs its currency to another nation's currency (fixed exchange rate)?
c)What disadvantages does a nation have if it pegs its currency to another nation's currency?
d)What advantages does a nation have when it allows market forces to determine the exchange rate of a currency (floating exchange rate)?
e)What disadvantages does a nation have when it allows market forces to determine the exchange rate of a currency?