What is foreign exchange rate?

The price of one currency in term of another

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Price of one quantity in terms of another

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Price of one currency in terms of another economies price

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Price of one economies price in terms of another economies currency

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Solution

The correct option is A The price of one currency in term of another
An exchange rate system, also called a currency system, establishes the way in which the exchange rate is determined, i.e., the value of the domestic currency with respect to other currencies.
Choosing the currency system is a pivotal element of the economic policy adopted by a country's government.

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Similar questions

State any two factors that explain the contraction of supply of foreign currency when its price in terms of the domestic currency falls.

State any two factors that explain expansion of demand for a foreign currency in response to a fall in its price (in terms of the domestic currency).

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