The Fact That Exchange Rates Are Nearly Identical in Different

question 93

Multiple Choice

The fact that exchange rates are nearly identical in different markets around the world is due to

• A)the actions of speculators
• B)official action by central banks around the world
• C)the actions of arbitrageurs
• D)agreement by policy makers of the major industrial countries
• E)the actions of currency converters

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Definitions:

Shift Factors

Variables or conditions that can cause a shift in demand or supply curves, thus changing market equilibrium.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor, such as labor or capital, in the production process.

Winner-Take-All Markets

Markets in which a few individuals or companies obtain a large majority of the rewards, often seen in industries like technology and entertainment.

Music Industry

The sector of the economy focused on the production, distribution, and promotion of music and related services.