In general, economists divide the world into two types of exchange rate systems:
A) long run and short run.
B) fixed and floating.
C) liberal and conservative.
D) speculative and risk averse.

Question

Quizplus · Accepted Answer

Economists divide exchange rate systems into fixed and floating. In a fixed exchange rate system, a country's currency is pegged to a fixed exchange rate with another currency or a basket of currencies. In a floating exchange rate system, the exchange rate is determined by market forces of supply and demand.

In General, Economists Divide the World into Two Types of Exchange