Question

what do do you mean by fixation of exchange rate ?​

Answer 1

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Fixation Of Exchange Rate is the rate at which the currency of one country in Exchange with the currency of another country .This rate keeps on changing with the change in demand of the currencies in the foreign exchange market .

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Answer 2

$\huge{\texttt{\underline{\red{Fixation of exchange rate}}}}$

◼ Fixation of exchange rate refers to the fixed rate set by the Central Bank in the official exchange rate .

◼ It also may refer to the fixation of a particular currency to any other value.

◼ The rate is fixed so that the currency exchange value of the country is restricted and kept constant .

◼ Fixed exchange rate helps to restore the economic condition in the country during a crisis.

◼ Fixed exchange rate may also be used for economic growth in the country.

◼ It is hence an important factor that the Central Bank should strategically use .

◼ Inflation rates get lowered due to the exchange rates being steady.

◼ The rate of the exchange rate is made very narrow .

◼ It helps in export and import pricing and is ultimately beneficial for the economy of the country.

◼ However the fixation must be properly planned and maintained in order to be beneficial for the country .