Consider the Equilibrium a + B C

question 26

Multiple Choice

Consider the equilibrium A + B C. What is significant about the equilibrium state in which [B] = [C]?

• A) [A] = K
• B) [A] = [B] = [C]
• C) [B] = [C] = K
• D) [A] = 1/K
• E) [C]/[B] = K

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Definitions:

Exchange Rates

The value of one currency for the purpose of conversion to another, implying how much of one currency can be exchanged for another.

Foreign Currency (FC)

Currency used in a transaction that is different from the currency of the primary economic environment in which the entity operates.

Historical Rate

The exchange rate at which a foreign currency transaction was converted to the reporting currency at the date of the transaction.

Closing Rate

The exchange rate at the balance sheet date, used for translating the financial statements of a foreign subsidiary into the parent company's reporting currency.