Insisting the Contracts Be Denominated in the U

question 38

Multiple Choice

Insisting the contracts be denominated in the U.S.dollar can help avoid ________.

• A) Exchange rate risk
• B) Arbitrage
• C) Political risk
• D) PPP

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Definitions:

Equilibrium Price

The price at which the quantity of a product demanded by consumers equals the quantity supplied by producers.

Consumer Surplus

The divergence between the total payment consumers are willing to make for a product or service and what they really pay.

Demand Increase

A situation where consumers are willing and able to purchase more of a product or service at each price level, often caused by changes in tastes, income, or prices of related goods.

Consumer Surplus

The separation in monetary terms between what consumers are willing to pay for a good or service and their final payment amount.