Under flexible exchange rate system, each country fixes its value of currency in terms of some external standard.

True

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False

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Solution

The correct option is B False
This happens in case of fixed exchange rate system.
Under Flexible exchange rate system, value of currency is determined by the market forces of demand and supply.

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Similar questions

(a) What is foreign exchange rate?

(b) How it is determined under fixed and flexible exchange rate system?

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