The Figure Given Below Depicts the Foreign Exchange Market for British

question 8

Multiple Choice

The figure given below depicts the foreign exchange market for British pounds traded for U.S. dollars.Figure 22.2

-When a U.S. importer needs $22,000 to settle an invoice for 25,520 Swiss francs, the exchange rate must be:

• A)1 Swiss franc = $1.16.
• B)1 Swiss franc = $0.16.
• C)1 Swiss franc = $0.84.
• D)$1 = 1.16 Swiss franc.
• E)$1 = 1.84 Swiss franc.

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Definitions:

Variable Costs

Costs that fluctuate in direct relation to the level of production or volume of operations in a business.

Fixed Costs

Costs that remain constant and do not change based on the volume of goods or services a business produces.

Required Sales

The amount of sales a company needs to achieve in order to cover its costs and reach a desired level of profit.

Net Income

The company's earnings following the deduction of all taxes, expenses, and costs from its total revenue.