When a Country Suffers from Capital Flight,the Exchange Rate

question 99

Multiple Choice

When a country suffers from capital flight,the exchange rate

• A)depreciates,because demand in the market for foreign-currency exchange shifts left.
• B)depreciates,because supply in the market for foreign-currency exchange shifts right.
• C)appreciates,because demand in the market for foreign-currency exchange shifts right.
• D)appreciates,because supply in the market for foreign-currency exchange shifts left.

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Definitions:

Pain Of Losing

The emotional or psychological distress experienced after suffering a loss, often more intense than the joy of equivalent gains.

Firm-Specific Risk

Firm-specific risk refers to the risk associated with events or factors that are unique to a particular company, which can affect its stock price.

Market Risk

The risk of losses in financial markets arising from movements in market prices.

Stocks

Financial securities representing partial ownership in a company, allowing investors to claim on the company's assets and earnings.