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Compare and contrast fixed and floating exchange rate systems.

Question:

Compare and contrast fixed and floating exchange rate systems.

Types of Exchange Rate

An exchange rate is the price for which a currency of a country can be exchanged for another county's currency.It is influenced by interest rates,inflation rate,trade balance,political stability,internal harmony,general state of economy and quality of governance.Fixed and floating exchange rates are the types of exchange rate.

Answer and Explanation:

A Floating exchange rate is a rate that is determined by the private market through supply and demand while a fixed exchange rate is a rate that the...

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Exchange Rate Risk & Forms of Exposure

from Finance 101: Principles of Finance

Chapter 20 / Lesson 5
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