A managed floating exchange rate is a market determined exchange system as long as rates stay between target zones as mandated by legislative commitments.

Question

Quizplus · Accepted Answer

A managed floating exchange rate involves a government or central bank influencing the exchange rate through buying and selling currencies, rather than letting it be entirely determined by market forces, even though it may not have specific target zones mandated by legislation.

A Managed Floating Exchange Rate Is a Market Determined Exchange