The price of one country's currency in terms of another's is called
A) the interest rate.
B) the inflationary premium.
C) the discount rate.
D) the exchange rate.

Question

Quizplus · Accepted Answer

The exchange rate refers to the price of one country's currency in terms of another's. A represents the interest rate, which is the cost of borrowing money. B represents the inflationary premium, which is an additional amount added to the interest rate to account for inflation. C represents the discount rate, which is the interest rate used by central banks to lend money to commercial banks.

The Price of One Country's Currency in Terms of Another's