Exchange Rate
An exchange rate is the value at which one currency can be exchanged for another. It determines how much of one currency you need to buy a unit of another. For example, if the exchange rate between the US dollar and the euro is 1.10, it means you need 1.10 dollars to buy 1 euro. Exchange rates fluctuate based on economic factors like interest rates, inflation, and political stability, influencing international trade and travel costs. They play a critical role in the global economy, affecting everything from imports and exports to foreign investments.
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An exchange rate is the value at which one currency can be exchanged for another. For example, if you’re traveling from the U.S. to Europe, the exchange rate tells you how many euros you can get for your dollars. Exchange rates fluctuate based on various factors, including economic conditions, interest rates, and market demand. They are important for international trade, investments, and travel, as they determine how much currency you need to spend or how much you'll receive when you change money. Understanding exchange rates helps individuals and businesses make informed financial decisions globally.