If a government with a fixed exchange rate chooses to increase the rate, its currency:
A) will be revalued.
B) will be devalued.
C) will depreciate.
D) will appreciate.

Question

Quizplus · Accepted Answer

If a government with a fixed exchange rate chooses to increase the rate, it means they are increasing the value of their currency relative to another currency. This is known as revaluation. Therefore, the correct answer is A.

If a Government with a Fixed Exchange Rate Chooses to Increase