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Difference between fixed exchange rate and …

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Difference between fixed exchange rate and flexible exchange rate

    • Posted by Krishna Goel Goel 6 years, 3 months ago

    CBSE > Class 12 > Economics
    • 1 answers

    Sia ? 6 years, 3 months ago

    Fixed Exchange Rate Floating Exchange Rate
    It refers to a system in which the exchange rate for a currency is fixed by the government & thus maintains a stable market. It refers to a system in which the exchange rate is determined by forces of demand and supply and thus the market remains unstable.
    Under this system, each country keeps the value of its currency fixed in terms of some external standard like Gold, Silver, etc. Under this system, the value of the currency is determined by forces of demand and supply.
    It is done through Devaluation and Revaluation. It is done through Depreciation and Appreciation.

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