| 1. Fixed rates are currency values which are tied to a precious metal such as gold, or anchored to another currency, like the US Dollar. |
| II. Under a fixed system, a currency can rise or fall due to changes in demand or supply of currencies on the foreign exchange market. |
| III. Under this imports and exports can readjust to move the balance of payments back towards a desirable equilibrium. |
A) I & II
B) I & III
C) II & III
D) Only I
Correct Answer: D
Solution :
Fixed rates are currency values which are tied to a precious metal such as gold, or anchored to another currency, like the US Dollar. This method was brought by the International Monetary Fund (IMF).
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