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Which of e following best explains what happens to the exchange rate of a floating currency?
The exchange rate of a floating currency is determined by market forces, primarily supply and demand for that currency in the foreign exchange market. Factors such as interest rates, inflation, political stability, and economic performance influence these dynamics. When demand for a currency increases, its value rises; conversely, if demand decreases or supply increases, the currency's value falls. This continuous fluctuation reflects the relative economic conditions of the countries involved.
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What best explains what happens to the exchange of a floating currency?
The exchange rate for that currency changes depending on the operations of the free market
What best explains what happens to the exchange rate of a floating currency?
The exchange rate for that currency changes depending on the operations of the free market
What best explains the difference between a fixed currency and a floating currency?
The price of a floating currency is determined by the currency exchange market while the price of a fixed currency is connected to the price of some other commodity.
What is a currency whose value is determined by the supply and demand for the currency in the market?
Pegged currency ^For me on apex 2022 :)
If the supply and demand for currency determines the exchange rates this is called?
floating
What best explains what happens to the exchange of a floating currency?
The exchange rate for that currency changes depending on the operations of the free market
What best explains what happens to the exchange rate of a floating currency?
The exchange rate for that currency changes depending on the operations of the free market
What best explains the difference between a fixed currency and a floating currency?
The price of a floating currency is determined by the currency exchange market while the price of a fixed currency is connected to the price of some other commodity.
What is a currency whose value is determined by the supply and demand for the currency in the market?
Pegged currency ^For me on apex 2022 :)
If the supply and demand for currency determines the exchange rates this is called?
floating
Does Mexico use fixed or floating system?
Of currency exchange? Floating, as a free market should be.
Which exchange rate is following by India?
Floating Exchange Rate
The value of one's country's currency as compared to another country's currency?
Floating exchange rate
What is the difference between a floating and a pegged exchange rate?
pegged exchange rate is officially fixed in terms of gold or any other currency in foreign exchange. Floating exchange rate is flexible rate in which value of currency is allowed to adjust freely determined by the supply & demand of foreign exchange
What is depritiation?
depreciation is a reduction in the value of a currency in a floating exchange rate system.
Discuss whether it is better for a country with a floating exchange rate to face an appreciation or depreciation of its currency?
The great atraction of a floating exchange rate is that in theory it provides a kind of automatic mechanism for keeping the balance of payment in equilibrium.
What is the meaning of dirty floating?
Dirty floating is a system where a currency's exchange rate is allowed to fluctuate freely based on market forces, but central banks also intervene occasionally to adjust the currency's value. This intervention can occur to stabilize the currency or to achieve other economic objectives.
