Question

An exchange rate tells you _________________. A. The value of a government bond after a set amount of years B. The value of a currency when it’s converted to another currency C. The current level of spending power in your country D. The current rate of inflation in your country Please select the best answer from the choices provided A B C D

Answer 1

B. The value of a currency when it’s convertedto another currency

Answer 2

Answer:

The value of a currency when it's converted to another currency ( B )

Explanation:

An exchange rate is rate set for the conversion of one currency to another currency. the exchange rate between one currency and a multiple number of currencies are not the same.

For example the exchange rate for changing $1 to pounds is different from converting $1 to euros. this rate is determined by so many factors which could be technical, fundamental or sentimental factors.

under the technical factors large currency traders usually hedge funds managers might influence the exchange rate of a particular currency against another. under fundamental Government policies and natural disasters might as well influence the exchange rates of a currency against another, while sentimental analysis is based purely on Market sentiment of whether a currency value will fall or rise in the nearest future.