Under the Floating Exchange Rate System, a Fall in the Market

question 37

Multiple Choice

Under the floating exchange rate system, a fall in the market price of a currency is called:

• A)devaluation.
• B)depreciation.
• C)appreciation.
• D)revaluation.

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Definitions:

Direction

Guidance or supervision on how to perform tasks or the course along which something moves or is aimed to move.

Cognitive Dissonance Theory

A psychological theory suggesting that individuals experience discomfort when holding contradictory beliefs and are motivated to reduce this dissonance by changing their attitudes or behaviors.

Postdecisional Dissonance

Psychological discomfort experienced after making a difficult decision, often leading to regret or questioning of the choice.

Festinger

A psychologist known for developing the theory of cognitive dissonance and contributing significantly to the field of social psychology.