Question

Currently, how are foreign exchange rates established?
A) Foreign exchange rates are unregulated.
B) Governments set the foreign exchange rates.
C) The World Bank establishes foreign exchange rates.
D) The World Trade Organization establishes foreign exchange rates.

Answer 1

Answer:

Foreign exchange rates are unregulated

Explanation:

This is because what really determine the exchange rate is the forces of demand and supply that is price mechanism which can be refer to as floating rate, it also can be cause by the inflation rate, interest rate, political stability an instance where a country is passing through some kind of war the country currency tend to fall because then the inflation rate will be very high.

Answer 2

Answer:

Foreign exchange rates are unregulated

Explanation:

Although governments may work together with central banks to restore stability to the market, foreign exchange rates are unregulated.

Correct on USATESTPREP! :)