Problem
1. Why do central banks intervene in foreign exchange markets? How do these interventions affect their international reserves and exchange rates?
2. How do fixed, floating, and managed or dirty float exchange rate regimes differ?
3. What happens in a fixed exchange rate regime if a currency is overvalued? What problem can this create?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.