What Are the Three Main Lessons on Crisis Learned from Early

question 7

Multiple Choice

What are the three main lessons on crisis learned from early developing countries in Latin America?

• A) choosing the right exchange rate regime, the importance of contagion and the importance of the banking system
• B) choosing the right real rate, the importance of following exchange rates, and keeping prices high to make the most profit
• C) pegging exchange rates with Euros, keeping labor cost and wages low
• D) maintaining money supply, avoiding tariffs, and increasing output
• E) maintaining money supply, avoiding inflation, and increasing production

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Definitions:

Exporting

Is the process of making a product in the firm’s domestic marketplace and then selling it in another country. Exporting can involve both goods and services.

International Business Strategy

A plan of action that companies adopt to enter and compete in the global marketplace.

Trade Controls

Regulations and policies implemented by governments to oversee the import and export of goods and services, often for reasons of national security, economic protection, or foreign policy.

Labor Unions

Organizations that represent workers in negotiations with employers over wages, working conditions, and rights.