Floating exchange rates are less volatile than fixed rates.

Name: Floating exchange rates are less volatile than fixed rates.
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Question

Quizplus · Accepted Answer

Floating exchange rates are more volatile than fixed rates because they are determined by the market forces of supply and demand, which can be influenced by a variety of factors such as economic and political events, while fixed rates are set by government policy and do not fluctuate as much.

Floating Exchange Rates Are Less Volatile Than Fixed Rates