Foreign Currency Exchange: Supply and Demand for Currency


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question 1 of 3

When are exchange rates determined by demand and supply forces?

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1. What is the rate at which one currency is converted in another called?

2. Which of the following statements is true?

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About This Quiz & Worksheet

Currencies, like products, have ever-changing demands and supplies. Achieve a better understanding of the factors that steer supply and demand with these materials. Our interactive quiz will test your comprehension of supply and demand and ask you to read graphs that illustrate how they affect each other.

Quiz & Worksheet Goals

Using this quiz and worksheet combo set, you will increase your understanding of the relationship between the following:

  • Demand for a currency
  • Supply of a currency
  • Exchange rate

Skills Practiced

Use the following skills when working with these assets:

  • Making connections - use understanding of the concept of the correlation between demand and supply
  • Critical thinking - apply relevant concepts to examine information about the exchange rate of currencies in a different light
  • Problem solving - use acquired knowledge to solve practice problems involving supply and demand graphs

Additional Learning

To better understand supply and demand for currency, study the corresponding lesson Foreign Currency Exchange: Supply and Demand for Currency. It will teach you how to:

  • Describe how Black Friday demonstrates the law of demand
  • Explain why an increase in demand and supply for a currency will affect its exchange rate
  • Interpret graphs that communicate the relationship between a currency's supply and demand