A pegged exchange rate means that the value of a currency is:
A) fixed against other currencies based on an agreement.
B) not determined by free market forces.
C) fixed relative to a reference currency.
D) independent of the valuations of other currencies.

Question

Quizplus · Accepted Answer

A pegged exchange rate means the value of the currency is fixed relative to a reference currency, such as the U.S. dollar, and then the exchange rate between that currency and other currencies is determined by the reference currency exchange rate.

A Pegged Exchange Rate Means That the Value of a Currency