An Increase in the Exchange Rate Value of the U

question 3

Multiple Choice

An increase in the exchange rate value of the U.S. dollar, relative to the Japanese yen, will cause U.S. imports from Japan to

• A) increase and exports to Japan to decrease.
• B) increase and exports to Japan to increase.
• C) decrease and exports to Japan to decrease.
• D) decrease and exports to Japan to increase.

---

Definitions:

Static Budget

A financial plan that does not change or adjust over the period, regardless of any changes in business activity levels.

Flexible Budget

A budget that adjusts to changes in activity or production levels, allowing for more accurate budgeting.

Actual Results

The actual outcomes or figures achieved by a business, contrasting with forecasts or budgeted amounts.

Revenue Variance

The difference between the actual revenue for the period and how much the revenue should have been, given the actual level of activity. A favorable (unfavorable) revenue variance occurs because the revenue is higher (lower) than expected, given the actual level of activity for the period.