In what type of system is the rate based on the government's view of an appropriate rate in the context of the country's balance of payments position, foreign exchange reserve, and rates quoted outside of the official market?

Question

Quizplus · Accepted Answer

The described system is a managed float, where the government still has some influence on the exchange rate but allows market forces to have some role in determining it. A dirty float involves more direct government intervention and manipulation of the exchange rate, while an independent float allows market forces to fully determine the rate without government interference. A dry float is not a commonly used term in the context of exchange rate systems.

In What Type of System Is the Rate Based on the Government's