how is the Foreign Exchange rate is determined under the free exchange market
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In a free-floating exchange rate system, exchange rates are determined by demand and supply.
Exchange rates are determined by demand and supply in a managed float system, but governments intervene as buyers or sellers of currencies in an effort to influence exchange rates.
In a fixed exchange rate system, exchange rates among currencies are not allowed to change. The gold standard and the Bretton Woods system are examples of fixed exchange rate systems.
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