Which of the Following Is True of Exchange Rates and Foreign

question 49

Multiple Choice

Which of the following is true of exchange rates and foreign currency?

• A) Companies that purchase goods or services from foreign countries must pay for them with local currency.
• B) Companies purchase foreign currency from banks, which convert each currency into dollars.
• C) Exchange rates remain constant.
• D) Exchange rates do not have any effect on profits.
• E) Exchange rate is of no prominence to businesses.

---

Definitions:

Caterpillars

The larval stage of butterflies and moths, characterized by a segmented body and often distinct patterns or colors that feed voraciously before pupating.

Competition

A biological interaction where organisms vie for the same resources, such as food or habitat, in an ecosystem.

Symbiosis

A close, long-term interaction between two different biological species, which may be mutualistic, commensalistic, or parasitic.

Batesian Mimicry

A type of mimicry in which a non-threatening species develops similar warning signals to those of a dangerous species to avoid predation.