Explain the Difference Between a 'Floating Exchange Rate', a 'Managed

question 15

Essay

Explain the difference between a 'floating exchange rate', a 'managed float' and a 'fixed exchange rate'.
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Definitions:

Unexpected Price Changes

Price movements that occur without prior indication or contrary to the predictions based on market or economic fundamentals.

Contract

A legally binding agreement between parties that outlines the terms and conditions of a particular arrangement or deal.

Forward Contracts

Agreements to buy or sell an asset at a future date for a price agreed upon today, often used for hedging or speculation.

Marked-To-The Market

An accounting practice where assets or securities are valued according to their current market price, not their purchase price or book value.