Which of the following statements is true?

Statement 1- The rate at which currency of one country is converted into currency of other country, is called as foreign exchange rate.

Statement 2- There are 2 types of foreign exchange rate system i.e. Fixed and Formal exchange rate system.

Only statement 1 is true

• Statement 1 is true. The rate at which currency of one country is converted into the currency of another country is indeed called the foreign exchange rate.
• Statement 2 is false. There are 3 types:
  • Fixed exchange rate system
  • Flexible exchange rate system
  • Managed floating rate system
• "Formal exchange rate system" is not a recognized term.