If Foreign Debt Obligation Must Be Served,the Amount of Local

question 35

Multiple Choice

If foreign debt obligation must be served,the amount of local currency required to do this will:

• A)increase as the currency depreciates,and this effectively raises the cost of capital.
• B)decrease as the currency depreciates,and this effectively decreases the cost of capital.
• C)increase as the currency appreciates,and this effectively raises the cost of capital.
• D)increase as the currency appreciates,and this effectively decreases the cost of capital.

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