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Question
Which of the following statements is true about a currency board system?A.Under a strict currency board system, interest rates adjust automatically based on the supply and demand of domestic currency.
B.To convert domestic currency on demand into another currency, a currency board takes grants from the International Monetary Fund.
C.This system is a true fixed exchange rate regime, because the domestic currency is fixed against other currencies.
D.A currency board can issue additional domestic currency even when there are no foreign exchange reserves to back it.
E.A currency board authorizes the government to print money and set interest rates.
Answer
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