Question
Economics Question on External Sector and Currency Exchange rate
Which of the following is revaluation of currency in fixed exchange rate system ?
A
The price of domestic currency is pegged with two or more foreign currencies
B
When the government decreased the exchange rate
C
When the government increases the exchange rate
D
The price of domestic currency in terms of foreign currency increases.
Answer
When the government decreased the exchange rate
Explanation
Solution
The correct option is (B) :When the government decreased the exchange rate.