Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Open Economy Macro Economics

Question:

Which of the following is also known as "Hybrid system" of exchange rate?

Options:

Managed floating rate system

Flexible exchange rate system

Fixed exchange rate system

Negotiable exchange rate system

Correct Answer:

Managed floating rate system

Explanation:

Managed floating rate system, which is also called as "Hybrid system" of exchange rate is a system in which foreign exchange rate is determined by the market forces and central bank stabilizes the exchange rate in case of appreciation or depreciation of domestic currency.