A ________ Exchange Rate Means That the Rate Changes Constantly

question 7

Multiple Choice

A ________ exchange rate means that the rate changes constantly depending on the quantity supplied and demanded for the currency.

• A) fixed
• B) floating
• C) banded
• D) none of the above

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Definitions:

Fair-return Price

A price that allows a company to cover its costs and make a reasonable profit.

Short Run

A period in economics where at least one input is considered fixed in the production process.

Natural Monopoly

A market condition where a single firm can provide a good or service at a lower cost than any potential competitor, often due to economies of scale.

Fair Return

A reasonable profit for a business, considered equitable for both the business owners and consumers, typically governed by regulatory strategies.