Which of the Following Is Most Likely to Result from a Stronger

question 92

Multiple Choice

Which of the following is most likely to result from a stronger dollar?

• A)U)S. goods exported aboard will cost less in foreign countries,and so foreigners will buy more of them.
• B)U)S. goods exported aboard will cost more in foreign countries and so foreigners will buy more of them.
• C)U)S. goods exported abroad will cost more in foreign countries,and so foreigners will buy fewer of them.
• D)Americans will purchase fewer foreign goods.

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Definitions:

Firm Completion

A commitment to finish a project or deliver a product by a specified date.

Asymmetric Information

Assumes managers have more complete information than investors about a firm’s prospects—can have an important effect on capital structure.

Diversified Portfolios

Investment strategies involving the mixing of various asset classes and securities to reduce risk through diversification.

Financial Distress

A scenario in which a business is unable to fulfill or struggles to pay its debts to those it owes money to.