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Open Economy Macroeconomics — Economics STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEconomicsOpen Economy Macroeconomics1 Mark
Question
What is the main advantage of flexible exchange rate?
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Answer

The main advantage of the flexible exchange rate is that movements in the exchange rate automatically take care of the surpluses and deficits in the Balance of Payments.

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