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Demerits of flexible exchange rate?
How do countries decide whether to adopt a flexible or fixed exchange rate system?
There are a number of factors that can influence this decision, including the country's level of economic development, its monetary policy goals, and its openness to international trade and investment. In general, countries with more developed financial systems and greater economic stability are more likely to adopt flexible exchange rate regimes, while those with less developed economies and weaker institutions may prefer fixed exchange rates for their relative stability.