Question

1. The flexible exchange-rate system is

A) a currency system in which governments try to keep the values of their currencies constant against one another

B) a currency system that allows the exchange rate to be determined by supply and demand

C) the result of a nation importing more than it exports

D) the method banks and other financial institutions use to calculate depreciation on trade deficits

Answer 1

B) a currency system that allows the exchange rate to be determined by supply and demand

Answer 2

The answer should be B