Since news is unexpected and catches people off-guard,
A) it is easy to forecast the future exchange rate.
B) it causes exchange rates to fluctuate substantially.
C) it causes prices of goods and services to vary more than exchange rates.
D) it has no effect on exchange rates.

Question

Quizplus · Accepted Answer

News can have a significant impact on exchange rates as it can alter investor expectations and cause uncertainty. This can lead to fluctuations in exchange rates as investors adjust their trading decisions in response to the news.

Since News Is Unexpected and Catches People Off-Guard