Multiple Choice QuestionEconomists consider the current exchange-rate system to be of which type?Multiple choice question.A government-controlled exchange-rate systemA gold standard exchange-rate systemA managed floating exchange-rate systemA fixed exchange-rate system
Question
Multiple Choice QuestionEconomists consider the current exchange-rate system to be of which type?Multiple choice question.A government-controlled exchange-rate systemA gold standard exchange-rate systemA managed floating exchange-rate systemA fixed exchange-rate system
Solution
The current exchange-rate system is considered by economists to be a managed floating exchange-rate system. This is because most countries allow their currency to fluctuate in value in response to changes in the foreign exchange market, but central banks will intervene if the currency appreciates or depreciates too rapidly.
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