If More Dollars Are Required to Buy a Unit of Foreign

question 20

Multiple Choice

If more dollars are required to buy a unit of foreign currency, then the dollar is:

• A) strengthening.
• B) weakening.
• C) violating the law of one price.
• D) not in equilibrium.

---

Definitions:

Cash Dividend

A payment made by a company out of its profits to shareholders, usually in the form of cash.

Dividends Payable

A liability on a company's balance sheet representing the amount of declared dividends that are owed to shareholders but not yet paid.

Retained Earnings

The portion of net income that is retained by the corporation rather than distributed to its owners as dividends.

Date of Payment

Refers to the specific day on which a payment is to be made or received, often relating to bills, debts, or other financial obligations.