Question
Fixed exchange rate and floating exchange rate.
Answer :
Word Count : 156
| Aspect | Fixed Exchange Rate | Floating Exchange Rate |
|---|---|---|
| Definition | Exchange rate is set and maintained by the government or central bank. | Exchange rate is determined by market forces of supply and demand. |
| Stability | More stable as the exchange rate is controlled. | Less stable, as it fluctuates based on market conditions. |
| Flexibility | Less flexible due to government control. | More flexible, adjusting according to economic conditions. |
| Government Involvement | High, as the central bank buys or sells currency to __________ _____ _____ _____ ____ _____ _____ _____. _____ ____ ____ _______ ___. ______ _____ ______ _________ __________ ______. _________ ______ _____ _______ ________ _________. ______ ______ ____ ______ ____ _______ ________ ____ _______ _______ _________ __________. ____ _____ __________ _____ ___ ____ _______ ______ _____ _____ ___ ___. _____ ___ ____ __________ ____ _________ _____ _________ _________. ___ ____ __________ ____ ________ ___ _____ ____ ________ ________ _____ ____. _________ ________ ___ _________ _________ __________ _________ __________. _______ _____ __________ _____ __________. _________ ________ ________ _______ _____ ____ ____ ______ ________ _________ _____. IGNOU ACADEMY Your IGNOU journey, made easier.
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