If the U.S. Dollar Appreciates, an MNC's

question 60

Multiple Choice

If the U.S. dollar appreciates, an MNC's:

• A)U.S. sales will probably decrease.
• B)exports denominated in U.S. dollars will probably increase.
• C)interest owed on foreign funds borrowed will probably increase.
• D)exports denominated in foreign currencies will probably increase.
• E)all of the above

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Definitions:

Cost of Direct Materials

Refers to the total cost of raw materials that are directly used in the production of goods.

Factory Depreciation

The process of allocating the cost of a physical factory plant and its equipment over its useful life, reflecting wear and tear over time.

Total Raw Materials

The sum of all raw materials that are available for use in the production process, including both those already in process and those in stock waiting to be used.

Direct Labor Costs

Expenses directly associated with the labor used in producing goods or services, including wages for employees who work on the production line.