If There Is a Black Market in Foreign Exchange, Then

question 8

Multiple Choice

If there is a black market in foreign exchange, then what is likely to be the case?

• A) There is no intervention in the foreign exchange market.
• B) There are no exchange controls.
• C) There is a free market in foreign exchange market.
• D) all of the above
• E) none of the above

---

Definitions:

U-Shape

A graphical representation describing a relationship or phenomenon that decreases, reaches a minimum point, and then increases, resembling the letter "U."

Economies of Scale

Reduction in per unit cost as the volume of production increases, due to factors like bulk purchasing and efficient use of resources.

Technological Change

The overall process of invention, innovation, and diffusion of technology or processes.

Returns to Scale

The rate at which output increases in response to proportional increases in all inputs or resources, reflecting the production efficiency of a firm.