A __________ Involves an Exchange of Currencies Between Two Parties,with

question 52

Multiple Choice

A __________ involves an exchange of currencies between two parties,with a promise to reexchange currencies at a specified exchange rate and future date.

• A) long-term forward contract
• B) currency swap
• C) parallel loan
• D) interest rate swap

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Definitions:

Comparative Advantage

The economic principle that a country or entity benefits by producing goods or services for which it has a lower opportunity cost than its trading partners.

Resource Employment

The utilization of economic resources, including labor, capital, and materials, in the production of goods and services.

Consumption And Investment

Expenditures by households on goods and services and allocations of resources for future earnings.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing between multiple options.