Question
The impossible trinity is a concept in international
economics which states that it is impossible to have all three of the following at the same time I. Fixed Exchange Rate II. Flexible Exchange Rate III. Independent Fiscal Policy IV. Independent Monetary Policy V. Perfect Capital MobilitySolution
The impossible trinity, or the trilemma, refers to the idea that an economy cannot pursue independent monetary policy, maintain a fixed exchange rate, and allow the free flow of capital across its borders at the same time.
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