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Home Questions UCGBXPR67F
Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Open Economy Macro Economics

Question:

Dirty floating exchange rate system is related to which of the following options?

Options:

Fixed exchange rate

Flexible exchange rate

Managed floating exchange rate

None of the above

Correct Answer:

Managed floating exchange rate

Explanation:

The correct answer is option 3: Managed floating exchange rate

Dirty floating exchange rate system is related to managed floating exchange rate system where RBI sets the limits within which the exchange rate can fluctuate depending on market demand and supply forces. RBI intervenes occasionally when exchange rate goes out of limits set by the central bank.

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