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Unformatted text preview: of demand and supply. In this case the currency value is allowed to fluctuate according to the response of foreign exchange market. The other form of exchange rate is the fixed exchange rate which is also sometimes known as pegged exchange rate is the rate which is fixed by central government or the central bank of the country and is maintained unless it is changed at the government discretion. As the exchange rate is not fixed under floating exchange rate system the risk of foreign exchange is higher....
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This note was uploaded on 02/21/2012 for the course ACT 492 taught by Professor Ngo during the Fall '11 term at Colorado.
- Fall '11