| Column I | Column II | ||
| A. | Nominal exchange rate | (i) | It is the price of one unit of foreign currency in terms of domestic currency |
| B. | Real exchange rate | (ii) | It is the exchange rate which does not account for changes in price level |
| C. | Nominal effective exchange rate | (iii) | It is the ratio of foreign to domestic prices, measured in same currency |
| D. | Flexible exchange rate | (iv) | It is the rate determined by the government of the country |
A) A - (i)
B) B - (ii)
C) C - (iii)
D) D - (iv)
Correct Answer: A
Solution :
Nominal exchange rate is the actual price at which one currency is exchanged for the others.
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