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In: Economics

What are the different types of currency regimes that governments around the world use? What do...

What are the different types of currency regimes that governments around

the world use? What do you think is the most ideal one and why?

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Expert Solution

Ans 4. The different types of currency regimes that governments Around The World use are

  1. conventional peg
  2. stabilizer arrangement
  3. crawling peg
  4. crawl like arrangement
  5. Pegged exchange rate with horizontal bands
  6. floating exchange rate
  7. free floating exchange rate.

Among all the above status 7 resigmes the ideal one or the best one is free floating or flexible exchange rate.

Flexible exchange rate is ideal because it is automatically adjusted by the demand and supply in the foreign exchange market so it is auto adjustable and very easy to understand and very easy to determined the currency value in comparison to the another currency value and it is Generally accepted by almost all the countries of the world.

Rahul Sunny answered 1 year ago
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