​Lampon Co

question 78

Multiple Choice

​Lampon Co. is a U.S. firm that has a subsidiary in Hong Kong that produces light fixtures and sells them to Japan, denominated in Japanese yen. Its subsidiary pays all of its expenses, including the cost of goods sold, in U.S. dollars. The Hong Kong dollar is pegged to the U.S. dollar. If the Japanese yen appreciates against the U.S. dollar, the Hong Kong subsidiary's revenue will ____, and its expenses will ____.

• A) ​increase; decrease
• B) ​decrease; remain unchanged
• C) ​decrease; increase
• D) ​increase; remain unchanged

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Definitions:

Encoding

The initial learning of information; transforming sensory input into a form that is memorable in the brain.

Intermediate

Positioned between two extremes or in the middle of a range, often referring to a level of skill, difficulty, or complexity that is not basic but not advanced either.

Impersonal

Lacking personal interest, attachment, or warmth; not relating to or influenced by personal feelings.

Sustained Attention

The ability to maintain attention to a selected stimulus for a prolonged period of time.