FIGURE 34-2 -Refer to Figure 34-2.If the Exchange Rate Is E₂,there Is

question 93

Multiple Choice

FIGURE 34-2
-Refer to Figure 34-2.If the exchange rate is e₂,there is

• A)an excess supply of foreign exchange.
• B)pressure for the Canadian dollar to appreciate.
• C)pressure for the exchange rate to fall.
• D)a shortage of Canadian dollars.
• E)an excess demand for foreign exchange.

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Definitions:

Money Market

A section of the financial market where short-term funds are borrowed and lent, involving instruments like treasury bills and commercial paper.

Cash on Hand

The total amount of any accessible cash or near-cash assets, such as money in checking or savings accounts, at any given time.

Negotiable Checks

Negotiable checks are financial instruments that allow the person in possession of the check to transfer the claim for payment to another party.

Petty Cash

A small amount of cash kept on hand for making immediate payments for miscellaneous small expenses.