A Pair of Shoes Costs £40 in Britain

question 66

Multiple Choice

A pair of shoes costs £40 in Britain. An identical pair costs $50 in the United States when the exchange rate is £1 = $1.50. Which of the following is correct?

• A) The United States offers a better deal.
• B) The deal is the same in both countries.
• C) Britain offers a better deal.
• D) A trader can make money by buying the shoes in Britain and selling in the United States at $50.

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Definitions:

Raw Materials

Basic substance in its natural, modified, or semi-processed state, used as an input to a production process for subsequent modification or transformation into a finished good.

Suppliers

Entities that provide goods or services to another organization, playing a critical role in the supply chain.

Distributors

Companies or entities that are responsible for delivering products from manufacturers to the final consumers or retailers.

Organization Chart

A visual representation of the hierarchical structure of an organization, showing relationships and ranks of positions within it.