Question

The foreign exchange rate of a country is the

Answer 1

(A) price of a foreign good in terms of the domestic good

(B) price of a foreign factor in terms of the domestic factor

(C) price of foreign trade in terms of the domestic trade

(D) price of a foreign currency in terms of the domestic currency

Answer: (D) Price of a foreign currency in terms of the domestic currency.

Explanation: To determine the foreign exchange rate of a country, it should determine how much value of money it should forego to get one currency note value of the other country.

Also see: Foreign Exchange Rate