Question

'Earlier, India followed a fixed exchange rate.'
In this statement, the 'fixed exchange rate' is related to which of the following?

• A. Exchange of goods
• B. Currency exchange
• C. Exchange of services
• D. Exchange of trade information

Answer 1

The correct option is B Currency exchange

Prior to the economic reform of 1991, India followed a fixed exchanged rate. It means, the government used to fix the exchange rate of the Indian rupee against a foreign currency.