foreign foreign 49 J 125 ai i is when the domestic currency

foreign; foreign 49 J 1.25 ai) i) is when the domestic currency is backed 100% by a foreign currency and in which the note-issuing authority establishes a fixed exchange rate to this foreign currency and stands ready to exchange domestic currency for the foreign currency at this rate whenever the public requests it. currency board O devaluation O dollarization O revaluation

Solution

Answer is Currency Board

In a currency board exchange rate system, exchange rate and money supply functions are conferred to a monetary authority who has the decision making with respect to nation\'s currency value, specifically if the currency should be pegged to a foreign currency, with an equal amount of which is held in reserves.

Devaluation of currency is allowing the currency to depreciate sharply. This policy is generally followed by export oriented companies, to make their exports more competitive.

Dollarization is the process of aligning a country\'s currency with the US dollar. In these countries, US Dollar is also allowed as a legal tender, similar to nation\'s own currency.

Revaluation of currency is allowing the currency to appreciate sharply.