q explain how brazil was able to reduce the, International Economics

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q explain how brazil was able to reduce the

Q. Explain how Brazil was able to reduce the rate of inflation from 2,669 percent in 1994 to less than 10 percent in 1997?

Answer: By initiating a new currency and initially pegging it to the dollar. At the cost of extensive bank failures high interest rates in 1995 and the shift to a fixed upwardly crawling peg and a substantial real appreciation of the local currency.

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