The term 'Managed Floating' exchange rate system means that:
A. The exchange rate is rigidly fixed by the government
B. The exchange rate is fixed in terms of gold only
C. The exchange rate is largely market-determined with occasional central bank intervention
D. There is no role whatsoever for the central bank
Answer: Option C
Solution (By JKSSB Mock Tests)
Under a managed float, the exchange rate is primarily determined by market forces, but the central bank intervenes from time to time to prevent excessive volatility or disorderly movements.
Explanation:
Commercial banks accept demand deposits (current accounts), savings deposits and time (fixed) deposits. Equity deposits are not a standard category of bank deposits.
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