A foreign exchange rate constitutes the
A) price of foreign currency as it is determined by the World Bank.
B) price of one country's currency in terms of another country's currency.
C) dollar value of imports and exports undertaken in the world economy during one year.
D) price of foreign currency as it is established by the relative amount of tourism.
E) dollar value of U.S. international trade.

Question

Quizplus · Accepted Answer

A foreign exchange rate represents the price of one country's currency in terms of another country's currency. It is determined by the currency market and fluctuates based on supply and demand factors, as well as economic and political conditions of the countries involved. Options A, C, D, and E are not accurate descriptions of a foreign exchange rate.

A Foreign Exchange Rate Constitutes the