An Overvalued Exchange Rate Is an Exchange Rate

question 120

Multiple Choice

An overvalued exchange rate is an exchange rate:

• A)that equals the number of units of a foreign currency over the number of units of domestic currency.
• B)that has an officially fixed value less than its fundamental value.
• C)at which the quantities of currencies demanded and supplied in the foreign exchange market are equal.
• D)that has an officially fixed value greater than its fundamental value.

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