Economy, asked by ashishpal5923, 1 month ago

Explain the mechanism through which internal and external balance takes place under flexible exchange rate.

Answers

Answered by solankiyashpal194

1

Answer:

Internal balance means a steady growth of the domestic economy consistent with a low unemployment rate. External balance is the achievement of a desired trade balance or desired international capital flows. ... Now the authorities must also consider the impact on the balance of trade, capital flows, and exchange rates.

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