Suppose That Great Britain Is a Major Export Market for Your

question 78

Multiple Choice

Suppose that Great Britain is a major export market for your firm, a U.S.-based MNC. If the British pound depreciates against the U.S. dollar,

• A)your firm will be able to charge more in dollar terms while keeping pound prices stable.
• B)your firm may be priced out of the U.K. market, to the extent that your dollar costs stay constant and your pound prices will rise.
• C)to protect U.K. market share, your firm may have to cut the dollar price of your goods to keep the pound price the same.
• D)both b and c are correct