Assertion (A): A fixed exchange rate reduces uncertainty for exporters and importers.
Reason (R): Traders know in advance how many rupees a dollar will cost.

Both A and R are true, and R is the correct explanation of A.Correct answerYour answerBoth A and R are true, but R is not the correct explanation of A.Correct answerYour answerA is true, but R is false.Correct answerYour answerA is false, but R is true.Correct answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

Stable rates make planning and pricing easier. R explains A.

Concept: Merit of a fixed rate
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsThe fixed rate: devaluation and revaluation

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Assertion (A): A fixed exchange rate reduces uncertainty for exporters and importers.Reason (R): Traders know in advance how many rupees a dollar will cost.

Explanation

Assertion (A): A fixed exchange rate reduces uncertainty for exporters and importers.
Reason (R): Traders know in advance how many rupees a dollar will cost.