A _____ means the value of the currency is fixed relative to a reference currency,and then the exchange rate between that currency and other currencies is determined by the reference currency exchange rate.
A) flexible exchange rate
B) pegged exchange rate
C) real exchange rate
D) dirty float exchange rate
E) floating exchange rate

Question

Quizplus · Accepted Answer

A pegged exchange rate is when a currency's value is fixed to a reference currency, such as the US dollar, and the exchange rate with other currencies is determined based on the exchange rate of the reference currency. This is different from a flexible or floating exchange rate where the value of the currency is determined by market forces of supply and demand.

A _____ Means the Value of the Currency Is Fixed