The More Efficient the Foreign Exchange Market Is, the More

question 25

True/False

The more efficient the foreign exchange market is, the more likely it is that exchange rate movements are random walks.

---

Definitions:

Economic Significance

The importance or impact of an economic activity or phenomenon in terms of its effects on the overall economy, such as employment levels or GDP.

Exchange

The act of trading goods, services, currencies, or other items of value between parties.

Comparative Advantage

The ability of an individual or country to produce a good or service at a lower opportunity cost than competitors.

Production Possibilities Curve

A graph that shows the combinations of two goods that an economy can produce using all its resources efficiently.