Question : Assertion: In case of Floating Exchange rate system currency price of a nation is set by the forex market based on supply and demand relative to other currencies.

Reason: Government intervenes in the foreign exchange market under Floating Exchange rate system to restrict the fluctuations in the exchange rate within certain limits.

Option 1: Both Assertion and Reason are true and correct explanation
 

Option 2: Both Assertion and Reason are true and incorrect explanation
 

Option 3: Assertion is true but Reason is false

Option 4: Assertion is false but Reason is true

Question : Statement1: Managed floating rate system is a hybrid of fixed exchange rate and a flexible exchange rate system.

Statement 2: Managed floating rate system is also known as Dirty floating.

Option 1: Both the statements are true.
 

Option 2: Both the statements are false.
 

Option 3: Statement 1 is true and Statement 2 is false

Option 4: Statement 2 is true and Statement 1 is false

Question : Identify which of the following statements is true?

Option 1: The flexible exchange rate system gives the government more flexibility to maintain large stocks of foreign exchange reserves
 

Option 2: In the Managed floating exchange rate system, the government intervenes to buy and sell foreign currencies.
 

Option 3: In the Managed floating exchange system, the central bank intervenes to moderate exchange rate fluctuations

Option 4: In the Fixed exchange rate system, market forces fix the exchange rate.

Question : Which of the following statement is correct?

• Under manage floating rate system, central bank maintains reserves of foreign exchange
• Manage floating rate system is also known as Dirty floating.

Option 1: Both are true 
 

Option 2: Both are false 
 

Option 3: Statement 1 is true and statement 2 is false.
 

Option 4: Statement 2 is true and statement 1 is false.
 

Question : Assertion: A financial market facilitates the exchange of financial assets.

Reason: Financial markets involve the trading of goods and services.

Option 1: Both assertion and reason are true, and the reason is the correct explanation of the assertion.
 

Option 2: Both assertion and reason are true, but the reason is not the correct explanation of the assertion.
 

Option 3: Assertion is true, but the reason is false.

Option 4: Assertion is false, but the reason is true.