What is Exchange rate?
Exchange rate: The price of one currency in another.
Where Exchange rate fits
Exchange rate is part of Trade & Currency in Global Trade. Trade connects economies through exports, imports, tariffs, quotas and trade agreements. Comparative advantage says countries should specialize in what costs them least.
Practical tip
Check duties, rules and currency risk before entering a market.
Related terms
- Tariff
- A tax on imported goods.
- Trade deficit
- Imports exceed exports in a period.
- GDP
- Total value of goods and services a country produces in a period.
- Export
- Selling goods or services to buyers in another country.
- Import
- Goods brought in from another country.
- Quota
- A limit on how much of a good can be imported.
- Free trade agreement
- A deal that removes most trade barriers between countries.
- Customs duty
- A tax collected on imported goods.
Formulas you will use with it
Test yourself
Which term means: “The price of one currency in another.”?
Trade deficit · GDP · Exchange rate
Answer: Exchange rate
Learn Exchange rate by playing
Quizzes, a CEO simulator, a real estate tycoon game and startup tools. Free to start, in 7 languages.
Play BizJourney free →