To maintain a fixed exchange rate under a shortage of FX reserves, the government has the following options, except

A) encourage foreign investment inflows, and restrict foreign investment outflows.
B) encourage imports, and discourage exports.
C) impose exchange controls or capital controls.
D) use monetary or fiscal policies to reduce domestic spending.

Fixed Exchange Rate

A rate of exchange that is set in some way and therefore prevented from rising or falling with changes in currency supply and demand.

FX Reserves

Foreign exchange reserves, assets held on reserve by a central bank in foreign currencies, used to back liabilities on their own issued currency as well as to influence monetary policy.

Foreign Investment

The investment of capital by individuals, firms, or governments in business interests located in another country.