Question

A small country that has experienced high inflation for the past decade decides to set the value of its currency equal to the value of a currency in a large nation that has had very low inflation for the past 50 years. The small country benefits because this action:

Answer 1

Answer:Will promote a higher level of international trade by reducing taxes on imports and increasing subsidies for exports.

Step-by-step explanation: When a country revalidates and makes it equal its currency equal to that of a better and larger country, the small country will benefit by encouraging a high scale international commerce by reducing taxed from imported items and increase its subsidies for exporters ready to export goods and services outside the Country.

International trade will place the small country on the pedestrian for better inflationary trends and over all economic growth.