The price of one currency in terms of another is called the exchange rate. The exchange rate affects the economy in our daily lives because it affects the price of domestically produced goods sold abroad and the cost of foreign goods bought domestically. “Mexicans use pesos, French use francs, Austrians use schillings, and this use of different monies by different countries results in the need to exchange one money for another to facilitate trade between …showed first 75 words of 2144 total…

…showed last 75 words of 2144 total…Rates, and the International System. Chicago: The University of Chicago Press, 1994. Einzig, Paul. The Case against Floating Exchanges. Great Britain: St. Martin’s Press Hasnat, Baban. “Exchange Rate Misalignment and Foreign Direct Investment”. Atlantic Economic Journal June 1999: 235-236. Husted, Steven., and Michael Melvin. International Economics. New York: University Of Pittsburgh, 1997 FRED. “Exchange Rates”. Retrieved November 11, 1999 from the World Wide Web At http://patriot.net/~bernkopf Gwinn, Robert P. “Exchange Rates.” The New Encyclopaedia Britannica. 1987 Ed.