which of the following best describes what an exchange rate is in the foreign exchange market? choose 1…

which of the following best describes what an exchange rate is in the foreign exchange market? choose 1 answer: a the purchasing power of a currency domestically b the interest rate c the ratio of how much goods cost in one country relative to another country d the quantity of goods and services a currency can buy in other countries e how much of one currency it takes to buy another currency

which of the following best describes what an exchange rate is in the foreign exchange market? choose 1 answer: a the purchasing power of a currency domestically b the interest rate c the ratio of how much goods cost in one country relative to another country d the quantity of goods and services a currency can buy in other countries e how much of one currency it takes to buy another currency

Answer

Brief Explanations:

An exchange rate in the foreign - exchange market is defined as the amount of one currency needed to purchase another currency. It represents the relative value of two different currencies. Options A and D relate to purchasing power, B is about the interest rate, and C is related to the price - level ratio between countries, but none of them define the exchange rate as accurately as the ratio of one currency to another for buying purposes.

Answer:

E. How much of one currency it takes to buy another currency