Chapter: Foreign Exchange Rate Bharat Kumar M.Com. M.A.(ECO)[Gold Medalist] UGC NET, Ph.D.(about to submit) Teaching Experience- 8 Years Follow me on Unacadem http://unacademy.com/user/kumar.bharat36-4255
Foreign Exchange Rate It is the rate at which two countries currencies can be exchanged. Ex. $1-268 Foreign Exchange Rate can be determined with the help oftwo methods 1. Fixed Exchange Rate System. 2. Flexible/Floating Exchange Rate System. The former method was the old methodi.e. earlier the exchange rate was based on fixed system. From 1971 the exchange rate started calculating on the based of flexible system and under this system the exchange rate was based on market mechanism i.e. on the based on Demand and Supply principle/Exports and Imports basis.
Graphical presentation of Foreign exchange rate OREIGN EXCHANGe RATE Depreciation of Currency: $1= 60 S1-265 Rato 2) INC ce Appreciation of Currency $1=700 $1-55 s/S foreign Currency Us(t)