1. The rule that governs a country's policy toward its exchange rate is known as:
the fixed exchange rate system.
the floating exchange rate system.
an exchange rate regime.
the rules of exchange.
2. A system in which exchange rates are set by government policy is a:
universal exchange system.
floating exchange rate system.
commodity standard system.
fixed exchange rate system.
3. A floating exchange rate is:
determined by the market.
set by government.
set by the International Monetary Fund.
determined by the United Nations.
4. Which would NOT be a method by which a country could maintain a fixed exchange rate?
purchases or sales of currency in the foreign exchange market
changing monetary policy to shift the supply and demand curve for its own currency
implementing foreign exchange controls
passing a law requiring that the exchange rate remain fixed