Assume a System of Floating Exchange Rates

question 24

Multiple Choice

Assume a system of floating exchange rates.In response to relatively high interest rates abroad,suppose domestic investors place their funds in foreign capital markets.The result would be

• A) a depreciation of the domestic currency and a rise in net exports
• B) a depreciation of the domestic currency and a fall in net exports
• C) an appreciation of the domestic currency and a rise in net exports
• D) an appreciation of the domestic currency and a fall in net exports

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Definitions:

Periodic Inventory Method

An accounting method that calculates the cost of goods sold and ending inventory levels at the end of an accounting period by conducting a physical count.

Payroll Department

The Payroll Department is responsible for managing employee compensation, including calculating wages, withholding taxes, and distributing paychecks.

Last Week's Wages

The total amount of compensation paid to employees for their work in the previous week.

Periodic Inventory Method

An accounting method that records inventory purchases and sales periodically, typically at the end of an accounting period.