Exchange Rates Are Equalized in Different Locations Due To

question 18

Multiple Choice

Exchange rates are equalized in different locations due to:

• A)arbitrage.
• B)government intervention in foreign exchange markets.
• C)free trade in goods and services.
• D)the actions of importers and exporters.

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Definitions:

Cash Ratio

A liquidity ratio that measures a company's ability to cover its short-term liabilities with its cash and cash equivalents.

Cash Equivalents

Short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value.

Current Liabilities

Current liabilities are a company's debts or obligations that are due to be paid to creditors within one year.

Long-term Debt

Debt obligations that are due for repayment in more than one year, often used by businesses to finance operations or acquisitions.