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List the benefits of the flexible exchange rate regime.
Answer: The benefits of the flexible exchange rate system include:
a) Automatic attainment of balance of payments equilibrium and
b) Maintenance of national policy autonomy.
In January 2010 your firm bought from an Italian firm goods payable in Euros worth EU2,000,000. Suppose that at that time the exchange rate of the Euros was 1EU=$1.25. Because th
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