Exchange Rate

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   appreciation      currencies      depreciation      devaluation      exchange rate      fixed      float      foreign currency      managed flexibility      supply   
When firms import goods and services they must also use to pay the country they bought them from. The price of a foreign currency is known as its foreign . That is, its value in terms of other countries’ . Most currencies are allowed to on the foreign exchange market according to the demand and of each currency. When the value of a currency falls it is known as a of its value. A rise in the price of a currency is known as an . Some governments have intervened in the foreign exchange market to fix their own value for their currency. This is known as exchange rate. Sometimes due to changing international markets the governments have to lower the exchange rate which is known as . Governments all control the price of its currency by selling or buying of their currency which is termed as .