Kind of exchange rate
State which kind of exchange rate has no official intervention in foreign exchange market? How it is recognized?
Expert
The Flexible exchange rate has no official intervention. This is recognized by the interaction of demand and supply in the foreign exchange market.
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Demand for foreign exchange is prepared to: (A) Purchase services and goods (B) Send gifts and funding(C) Speculate the value of foreign currencies, (D) Invest and procure financial assets
Describe the meaning of deficit in BOP: Whenever autonomous foreign exchange payments surpass autonomous foreign exchange receipts, the difference is termed as balance of payments deficit.
‘The country has a floating exchange rate and its inflation rate is much higher than its trading partners. Why we would suppose the country’s exchange rate to deflate?’
Induced investment: It is a type of investment that is of profit motive in nature.
Components of current account of BOP account: (A) Import-Export of goods(B) Import-Export of services(C) Unilateral transfers
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