If,at the Current Exchange Rate Between the Dollar and the Norwegian

question 184

Multiple Choice

If,at the current exchange rate between the dollar and the Norwegian kroner of 5.78 kroner per dollar,the dollar is "overvalued," how do you expect demand and supply in the foreign exchange markets to respond?

• A)The demand for the dollar will rise,while the supply of the kroner will fall.
• B)The demand for the dollar will fall,while the supply of the kroner will rise.
• C)The supply of the dollar will rise,while the demand for the kroner will fall.
• D)The supply of the dollar will rise,while the demand for the kroner will rise.

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Definitions:

Income Summary

An account used in the closing process that summarizes the revenue and expenses of an accounting period to determine the net income or loss.

Capital Account

An account showing the net worth of a business at a specific point, calculated as assets minus liabilities and preferred stock.

Revenues

The total income generated from normal business operations, often from the sale of goods and services.

Expenses

Expenses that a company incurs while generating income.