Foreign Exchange Rate

Price of one currency in relation to other currencies in the international exchange market is known as:

• Equilibrium rate

• Fixed exchange rate

• Exchange rate

• Flexible exchange rate

According to adjustable peg system ( or bretton Woods system) of exchange rate

• Different currencies ware pegged to one currency (US dollar)

• US dollar was assigned gold value at a fixed price

• Parity between two currencies was determined by the quantity of gold contained in them

• All of these

Under which system, gold was taken as the common unit of parity between currencies of different countries in circulation?

• Bretton woods system of exchange rate

• Gold Standard System of exchange rate

• Flexible exchange rate system

• Managed floating system of exchange rate

Out of the following, which is the most rigid exchange rate system, which does not allow any adjustment in the exchange rate?

• Flexible exchange rate system

• Gold Standard System of exchange rate

• Bretton Woods system of exchange rate

• None of these

The rate which is determined by the government is known as :

• Flexible exchange rate

• Fixed exchange rate

• Floating exchange rate

• None of these

The exchange rate at which demand for foreign currency becomes equal to its supply, is called:

• Equal rate of exchange

• Mint parity

• Equilibrium exchange rate

• All of the these

What is the relation ship between demand for foreign exchange and exchange rate?

• Inverse

• Direct

• One to one

• No relation

When supply of foreign exchange increases, the equilibrium exchange rate will

• Rise

• Fall

• Not change

• Either rise or fall

Demand for foreign currency depends upon;

• Repayment of international loan

• Direct foreign investment in the domestic economy

• None of this

• All of the above

Due to depreciation of foreign currency, the supply of foreign currency in domestic economy will;

• Increase

• Not change

• Either increase or decrease

• Decrease