When Rates of Return Are High in a Stable Economy

question 171

True/False

When rates of return are high in a stable economy, international investors buy stocks and bonds of that country. This activity increases the country's exchange rate.

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Definitions:

Equity Offering

The issuance of new shares by a company to the public or to institutional investors to raise capital.

Secondary Markets

Markets where securities are traded after being initially offered or sold in the primary market.

Stock Market Transaction

A financial operation such as buying, selling, or trading stocks that takes place in the stock market.

Local Broker

A brokerage firm that operates in a specific geographic area and may specialize in trading securities for local clients.