If the Exchange Rate Changes from 1 Euro Per U

question 109

Multiple Choice

If the exchange rate changes from 1 euro per U.S. dollar to 1.2 euros per U.S. dollar, the Euro has

• A) appreciated, since its value has increased.
• B) appreciated, since the price of U.S. dollars has increased.
• C) appreciated, making U.S. goods cheaper in Euros.
• D) depreciated, since its value has declined.
• E) depreciated, since its value has increased.

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Definitions:

Legal and Administrative Costs

Expenses incurred by a business for legal services and administrative operations.

Sole Proprietorships

A business structure where a single individual owns and operates the entity, bearing all responsibilities and privileges.

Partnerships

A legitimate business setup where two or more partners manage the company and share its earnings.

General Partnership

A business structure where two or more partners share unlimited liability for the debts and obligations of the business.