With Respect to Exchange Rates and Competition, It Is Correct

question 237

Multiple Choice

With respect to exchange rates and competition, it is correct to say that

• A) companies that conduct international operations do not have to worry about the effect of exchange-rate fluctuations on competition because the accounting department does the conversions.
• B) as the value of a country's currency falls, its balance of trade becomes less favourable.
• C) as the value of a country's currency falls, there is an increased incentive for foreign companies to ship products into the domestic market.
• D) Canadian firms can deal with a stronger Canadian dollar by increasing the efficiency their operations.
• E) all of these are correct.

---

Definitions:

Nitrogen

A colorless, odorless, tasteless gas that constitutes about 78% of the Earth's atmosphere; it is a critical element in the makeup of amino acids, proteins, and nucleic acids.

Ionic Compound

A substance made up of positively and negatively charged ions that are combined in a ratio to neutralize the charges.

Bromine

A reddish-brown liquid at room temperature, with the elemental symbol Br, and atomic number 35; it is a halogen and is used in various industrial applications.

Magnesium

A lightweight, silver-white metallic element, crucial for cellular metabolism and found in chlorophyll, often used in alloys and as a dietary supplement.