The rate at which one state's currency is exchanged for another state's currency in the global marketplace is known as
A)monetary policy.
B)the money supply.
C)the balance of payments.
D)an exchange rate.
E)arbitrage.

Question

Quizplus · Accepted Answer

The rate at which one state's currency is exchanged for another state's currency in the global marketplace is known as an exchange rate. Choice A, monetary policy, refers to the actions taken by a central bank to regulate the money supply and interest rates. Choice B, the money supply, refers to the total amount of money in circulation in a country's economy. Choice C, the balance of payments, refers to the record of all financial transactions between a country and the rest of the world. Choice E, arbitrage, refers to the practice of taking advantage of differences in prices of a particular asset or commodity in different markets.

The Rate at Which One State's Currency Is Exchanged for Another