The exchange rate is best defined as
A)the number of units of domestic currency which can be acquired with one unit of foreign money.
B)the number of units of domestic currency which can be acquired with one unit of domestic money.
C)the number of units of foreign currency which can be acquired with one unit of domestic money.
D)the number of units of foreign currency which can be acquired with one unit of foreign money.

Question

Quizplus · Accepted Answer

The exchange rate is the value of one currency in relation to another currency. In other words, it measures how much one currency can be traded for another currency. Therefore, the correct definition of the exchange rate is "the number of units of foreign currency which can be acquired with one unit of domestic money."

The Exchange Rate Is Best Defined as