Question : Which of the following is an example of an economic factor that can influence foreign exchange rates?
Option 1: Weather conditions
Option 2: Sports events
Option 3: Unemployment rates
Option 4: Social media trends
Correct Answer: Unemployment rates
Solution : The correct answer is c) Unemployment rates
Economic factors can have a significant impact on foreign exchange rates. Unemployment rates are one such economic factor that can influence exchange rates. When a country's unemployment rate is high, it may indicate a weaker economy, which can put downward pressure on the value of its currency. Conversely, a low unemployment rate may suggest a stronger economy, potentially leading to an appreciation of the currency.
Weather conditions, sports events, and social media trends are not direct economic factors that typically influence foreign exchange rates. While they may indirectly affect economic activity in certain industries or regions, they are not typically considered primary drivers of exchange rate movements.
