In A(n) ____ Exchange Rate System, the Foreign Exchange Market

question 56

Multiple Choice

In a(n) ____ exchange rate system, the foreign exchange market is totally free from government intervention.

• A) pegged
• B) dirty floating
• C) freely floating
• D) Bretton Woods
• E) none of the above

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Definitions:

WARP

An abbreviation for the Weak Axiom of Revealed Preference, a concept in economics that relates consumer choice to their preferences.

Bundle

A combination of goods or services that is considered together as a single composite good.

Laspeyres Price Index

An index used to measure the change in the cost of purchasing a fixed basket of goods and services over time, using the prices from the base period as weights.

Base Year

A specific year against which economic or financial data is compared, often used to calculate indices or real growth rates.