A flexible exchange rate between two countries is determined by

Question

Quizplus · Accepted Answer

A flexible exchange rate between two countries is determined by the demand and supply of both countries' currencies. The exchange rate will fluctuate based on changes in the economic conditions of both countries, such as inflation rates, interest rates, and trade balances. The governments of both countries may influence the exchange rate through their monetary and fiscal policies, but they do not have complete control over it. The International Monetary Fund may provide guidance and assistance to countries, but it does not directly determine exchange rates. The Bretton Woods agreement, which established a fixed exchange rate system, ended in the 1970s.

A Flexible Exchange Rate Between Two Countries Is Determined by