Who is largely involved in the determination of a fixed exchange rate?Multiple choice question.The governmentExportersImportersMultinational companies.
Question
Who is largely involved in the determination of a fixed exchange rate?Multiple choice question.The governmentExportersImportersMultinational companies.
Solution
The government is largely involved in the determination of a fixed exchange rate. This is because a fixed exchange rate, also known as a pegged exchange rate, is a type of exchange rate regime where a currency's value is fixed or pegged by the government to another single currency, a basket of other currencies, or to a precious commodity like gold.
Similar Questions
Multiple Choice QuestionWhat is the exchange-rate system in which the government sets the exchange rates?Multiple choice question.FlexibleFloatingFormalFixed
Multiple Choice QuestionIf a nation is utilizing a fixed exchange rate, which entity is responsible for exchanging domestic and foreign currency as needed to meet supply and demand?Multiple choice question.World BankFederal governmentCentral bankWorld Trade Organization
Multiple Choice QuestionWhat is the main problem that arises from the policies countries use to maintain a fixed exchange rate?Multiple choice question.They reduce the volume of world trade.They restrict the amount of currency that can be exchanged.They require the involvement of central banks.They limit how much gold is available for reserves.
Name three methods of exchange rate determination
Multiple Choice QuestionIn which type of exchange-rate system does the government operate as its own foreign exchange market?Multiple choice question.A flexible exchange-rate systemA floating exchange-rate systemA fixed exchange-rate systemA zero-sum exchange-rate system
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