The Exchange Rate Is Volatile Because

question 112

Multiple Choice

The exchange rate is volatile because

• A)the supply curve of dollars is vertical.
• B)the demand curve for foreign exchange is very steep.
• C)the supply of dollars and demand for dollars are influenced by similar events.
• D)government policy promotes interest rate fluctuation.
• E)the demand curve for foreign exchange is very flat.

---

Definitions:

Offering Price

The price at which shares of a company are initially made available for purchase during an initial public offering or other issuance.

Firm Commitment

An underwriter's guarantee to the issuer to sell an entire offering of stocks or bonds at a set price.

Offering Prospectus

A legal document issued by companies that are offering securities for sale, detailing the company's financial health and investment risks.