As Long as Trade Across Borders Is Unrestricted and Exchange

question 211

Multiple Choice

As long as trade across borders is unrestricted and exchange rates adjust freely, the purchasing power parity theory predicts that the exchange rate between two national currencies will adjust in the

• A)short run because of the actions of arbitrageurs
• B)long run to reflect differences in the nations' price levels
• C)long run to reflect changes in the governments' trade policies
• D)short run because of the actions of speculators
• E)long run to reflect differences in military power

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Definitions:

Modular Organization

A flexible organizational structure that consists of separate business units or modules, each focusing on a different product or service area.

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A system where operations or decisions are distributed among various locations or authorities rather than being concentrated in a single one.

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Teams that operate without the direct supervision of managers and instead rely on the collective skills and insights of the team members to manage their tasks and processes.

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The interconnected systems or groups of people that exchange information, resources, and support, often enhancing social, professional, or technological connectivity.