Exchange Rate Systems
Exchange Rate Systems
A floating exchange rate is determined by market demand for and supply of a currency, with no official target. A fixed exchange rate is pegged by the authorities to another currency or basket of currencies.
Step-by-step lessons on Edexcel A A Level Economics 4.1.8 Exchange rates. Each one builds up to exam-style questions. Start with the core supply-and-demand models before moving on to the more evaluation-heavy macroeconomic policy topics.