Foreign Trade

question 16

Multiple Choice

Foreign trade

• A)increases the scarcity of resources.
• B)makes a country more equitable.
• C)allows a country to have a greater variety of products at a lower cost than if it tried to produce everything at home.
• D)allows a country to avoid trade-offs.

---

Definitions:

Loan Liability

A financial obligation representing money borrowed by one party from another, requiring repayment with interest.

Foreign Exchange Rate

The rate or price at which one currency can be exchanged for another, influencing international trade and investment.

Interest

The cost of borrowing money or the income earned from lending money, usually expressed as a percentage of the principal.

Exchange Rates

The value of one currency expressed in terms of another currency, used in international transactions and foreign exchange markets.