Define Foreign Exchange Rate.

1.	Define Foreign Exchange Rate.
Answer» Foreign Exchange Rate : Foreign exchange rate refers to the rate at which one unit of currency of a country can be exchanged for the number of units of currency of another country. In other words, it is the price paid in domestic currency in order to get one unit of foreign currency. In other words, exchange rate expresses the ratio of exchange between the currencies of two countries. Hence, exchange rate is the price of a currency expressed in terms of another currency. (i) According to sayers, “ the price of currencies in terms of each other are called foreign exchange rate. “ (ii) According to crowther, “ The rate of exchange measures number of units of one currency which is exchanged in the foreign market for one unit.

Answer»

Foreign Exchange Rate : Foreign exchange rate refers to the rate at which one unit of currency of a country can be exchanged for the number of units of currency of another country. In other words, it is the price paid in domestic currency in order to get one unit of foreign currency. In other words, exchange rate expresses the ratio of exchange between the currencies of two countries. Hence, exchange rate is the price of a currency expressed in terms of another currency.

(i) According to sayers, “ the price of currencies in terms of each other are called foreign exchange rate. “

(ii) According to crowther, “ The rate of exchange measures number of units of one currency which is exchanged in the foreign market for one unit.

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