An Indirect Exchange Rate Can Be Converted to a Direct

question 60

Multiple Choice

An indirect exchange rate can be converted to a direct exchange rate by:

• A) dividing the indirect rate by the number of U.S. dollars required to purchase one unit of the other currency.
• B) dividing the indirect rate by 100.
• C) multiplying the indirect rate by the spot rate.
• D) taking the inverse of the indirect rate.

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Definitions:

Horizontal Merger

The combination of two or more firms operating in the same industry or producing similar goods or services.

Conglomerate Merger

A transaction that combines companies operating in completely unrelated business activities into a single corporation.

Vertical Merger

The merging of two or more businesses at various phases of production or distribution within the same sector.

Herfindahl Index

A measure of market concentration that sums the squares of the market shares of all firms in the market, used to assess competition levels.