What is the exchange rate?

Question

Quizplus · Accepted Answer

The exchange rate refers to the price of one nation's currency in terms of another nation's currency. It is the value at which one currency can be exchanged for another currency. For example, the exchange rate between the US dollar and the Canadian dollar indicates how many Canadian dollars can be bought with one US dollar.

Answer: D
 While central banks do participate in currency trading, the price that they charge each other for currency trading is not necessarily the same as the exchange rate. The exchange rate is primarily determined by supply and demand in the foreign exchange market.

What Is the Exchange Rate