The Dollar Per Euro Spot Rate Is 1

question 21

Multiple Choice

The dollar per euro spot rate is 1.2 when an importer of French wines places an order.6 months later,when she takes delivery,the spot rate is 1.3 dollars per euro.If her original invoice was for 30,000 euro,what is her gain or loss due to exchange rate risk?

• A) $3,000 gain
• B) $3,000 loss
• C) $6,000 loss
• D) no gain or loss

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Definitions:

Hierarchy

An arrangement or institution where individuals or entities are positioned in a hierarchical order based on their status or power.

Spatial Differentiation

The division or organization of space or geographical areas based on different functions, uses, or characteristics.

Geographic Dispersion

The spread or distribution of something or someone over a geographic area, indicating how spread out they are across different locations.

Vertical Differentiation

The arrangement of an organization into hierarchical levels, where each level has different levels of authority and responsibility.