At the Original Exchange Rate an Import Quota

question 152

Multiple Choice

At the original exchange rate an import quota

• A)creates a surplus in the market for foreign-currency exchange,so the exchange rate rises.
• B)creates a surplus in the market for foreign-currency exchange,so the exchange rate falls.
• C)creates a shortage in the market for foreign-currency exchange,so the exchange rate rises.
• D)creates a shortage in the market for foreign-currency exchange,so the exchange rate falls.

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Definitions:

Just Compensation

A principle requiring that when private property is taken for public use, the owner must be fairly compensated.

Trade Agreements

Contracts between two or more nations that outline how they will work together to ensure mutual benefit in trade.

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The process of resolving disputes or disagreements between parties through legal procedures or mutual agreements.

WTO

The World Trade Organization, an international body that deals with the rules of trade between nations to ensure that trade flows as smoothly, predictably, and freely as possible.