Question : When the Government wants to strengthen the rupee, it ________ foreign currency and ______ domestic currency.
Option 1: Buys, Sells
Option 2: Sells, Sells
Option 3: Sells, Buys
Option 4: Buys, Buys
Correct Answer: Sells, Buys
Solution : The correct answer is (c) Sells, Buys.
When the government wants to strengthen the rupee, it typically follows the approach of selling foreign currency and buying domestic currency.
Question : When domestic currency gains value in relation to a foreign currency in the international market, it is termed as a situation of:
Question : What is the meaning of exchange rate?
Question : The Indian Government launched Incredible India campaign to promote tourism in India? How it will impact the exchange rate?
Question : What is the term used to describe a situation where a country's central bank actively buys or sells its own currency in the foreign exchange market to influence its value?
Question : What does the term "currency appreciation" refer to?
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile