What is the disadvantage of flexible rates?
Asked by: Tillman Schuppe | Last update: June 26, 2025Score: 4.7/5 (17 votes)
What are the disadvantages of being flexible?
If you have too much flexibility without the necessary strength to accompany it, your body will be disconnected, and this is where you lose coordination, become inefficient, and increase the likelihood that you will get injured.
Which one of these is a disadvantage of a flexible exchange rate regime?
Question: Disadvantages of flexible exchange rates include theMultiple Choicerisk of changing exchange rates affecting domestic terms of trade (not international trade). uncertainty and diminished trade associated with a flexible exchange rate. need for exchange controls and rationing of foreign exchange.
What are the advantages of flexible rates?
Flexible exchange rates have the advantage that they allow a country to pursue an independent monetary policy, rather than have its own monetary policy set by an anchor currency country.
Which one is a demerit of the flexible exchange rate?
2 Uncertainty – Flexible exchange rate generates uncertainty and frequent changes in exchange rate discourage international trade and capital movements.
Disadvantages of Flexible Benefits
What are the disadvantages of flexible exchange rates?
Exchange Rate Volatility: Flexible exchange rates can be highly volatile, creating uncertainty for businesses engaged in international trade and leading to unpredictable costs and revenues. Inflationary Pressures: Sharp depreciations in the exchange rate can lead to imported inflation as the cost of imports rises.
How does flexible exchange rate affect the economy?
Economists have long argued that one of the advantages of flexible exchange rates is that countries become independent in terms of their ability to formulate domestic monetary policy. This is obviously not true when exchange rates are fixed.
What are the major disadvantages of a flexible benefits package?
- Costs time, money, and resources. A flexible benefits plan requires resources, including: ...
- Requires employee education. For your employees to fully invest in your benefits plan, they must understand: ...
- Lacks guidance.
What are the problems associated with a flexible exchange rate regime?
The flexible exchange rate is inconsistent, which makes the unreliability form of the receipts and payments. It also leads to the dispensable movements of capital between the countries. The increase in frequent transactions affects the economy by inflationary defects.
What does flexible rate mean?
Flexible rates have no special restrictions and follows the hotel's standard guarantee and cancellation policy. Non-Refundable rates are exclusive offers that require full prepayment at the time of booking and is nonrefundable.
What is true about a flexible exchange rate?
A flexible exchange rate system lets the exchange rate of a currency be determined by occasional government intervention whereas a fixed exchange rate system lets the value of the currency fluctuate.
What is the disadvantage of exchange?
There will be increased transactional costs for entering into and completing an exchange. Typical costs include possible additional escrow fees, attorney's fees, accounting fees, and the Qualified Intermediary's fees.
Which is preferable a fixed or a flexible exchange rate Why?
In general, a fixed exchange rate (or a greater degree of fixity) is preferable if the disturbances impinging on the economy are predominantly monetary –such as changes in the demand for money–and thus affect the general level of prices.
What is the negative form of flexible?
Rigid , inflexible , unyielding .
What are the disadvantages of flexible budget?
Limitations of Flexible Budgeting
Dependence on Forecasting Accuracy: The success of a flexible budget heavily depends on the accuracy of future business activity predictions. Inaccurate forecasts can lead to unrealistic budgets, resulting in poor financial planning and decision-making.
What are the 5 limitations to flexibility?
Muscle mass, bone structure, and the degree of elasticity of connective tissue limit flexibility potential. For most people more immediate limiting factors are lack of movement, not being suitably warmed up, not being well hydrated.
Which of the following are disadvantages to flexible exchange rate regimes?
However, the main disadvantage of a flexible exchange rate regime is that it creates more uncertainty and volatility of exchange rate movements, which can discourage trade and investment across countries.
What is the biggest disadvantage of a fixed exchange rate?
The disadvantages of a fixed exchange rate include:
Preventing adjustments for currencies that become under- or over-valued.
Which of the following problems will most likely occur with a system of flexible exchange rates?
Which of the following problems will most likely occur with a system of flexible exchange rates? Macroeconomic instability as exports and imports fluctuate with the exchange rates.
What are the disadvantages of flexible working?
- Loneliness, isolation and negative mental health impacts.
- Home office space (or lack thereof)
- Distraction and procastination.
- Loss of team comradery.
- Data Security.
- Blurring of home/work boundaries.
- Impacts on physical health.
- Inclusivity and diversity management.
What are the disadvantages of the flex program?
- Heavy on the Pocket.
- Choice of Benefits is Limited.
- Requires Implementation Time and Training.
- Complicated to Administer.
- Requires Solid Communication.
- Legal Requirements need Keen Attention.
What is the downside of a flexible benefit plan Quizlet?
What are the disadvantages of flexible employee benefit plans? -They are subject to the nondiscrimination requirements in Section 125 of the Internal Revenue Code. -They increase administrative burdens and expenses.
What are the main arguments presented against flexible exchange rates?
Many opponents of flexible exchange rates argued that the additional risks and transactions costs that would result from such a system would strongly discourage international trade and other international business activities.
What is the difference between a fixed and flexible exchange rate?
A fixed exchange rate denotes a nominal exchange rate that is set firmly by the monetary authority with respect to a foreign currency or a basket of foreign currencies. By contrast, a floating exchange rate is determined in foreign exchange markets depending on demand and supply, and it generally fluctuates constantly.
What is another name for flexible exchange rate?
Flexible rate of exchange is the rate which is determined by the supply-demand forces in the foreign exchange market. It is also called 'free exchange rate' or 'floating exchange rate' as it is determined by the free play of supply and demand forces in the international money market.