Question

Exchange rates can indicate economic health by

showing exactly how much of each nation’s currency is liquid.
revealing how much of each nation’s income goes to savings.
showing the relative strength of different nations’ currencies.
examining spending patterns across nations and continents.

Answer 1

Correct answer: showing the relative strength of different nations’ currencies.

Explanation: Exchange rates indicate how much one currency is worth in terms of another, so they reflect relative currency strength. They do not directly measure liquidity of a currency, national savings rates, or by themselves examine cross‑national spending patterns (although exchange rates influence trade and spending).