Which of the Following Is Consistent with Moving from a Shortage

question 125

Multiple Choice

Which of the following is consistent with moving from a shortage to equilibrium in the market for foreign currency exchange?

• A)the exchange rate falls so foreign residents want to buy more U.S.goods and services
• B)the exchange rate falls so foreign residents want to buy fewer U.S.goods and services
• C)the exchange rate rises so foreign residents want to buy more U.S.goods and services
• D)the exchange rate rises so foreign residents want to buy fewer U.S.goods and services

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Definitions:

Interest Expense

The cost incurred by an entity for borrowed funds; it is the price paid for the use of borrowed money.

Carrying Value

The amount at which an asset is recognized in the balance sheet, subtracting any accumulated depreciation or amortization.

Maturity

The date on which a financial instrument or obligation becomes due and is to be paid or settled.

Face Value

The nominal value printed on a bond or stock certificate, representing its legal value.