Currency markets operate under a system in which the prices of different currencies move up or down based on the demand and supply of each currency.This practice is called:
A) countertrading
B) floating exchange rates
C) variable purchasing power
D) flexible monetary policies
E) purchasing power elasticity

Question

Quizplus · Accepted Answer

The given scenario describes the concept of floating exchange rates, where the value of a currency is determined by the demand and supply of that currency in the market. Other options such as countertrading, variable purchasing power, flexible monetary policies, and purchasing power elasticity do not accurately describe the given scenario.

Currency Markets Operate Under a System in Which the Prices