Figure 19-12 -Refer to Figure 19-12.The Graph Above,depicts Supply and Demand for and Demand

question 256

Multiple Choice

Figure 19-12
-Refer to Figure 19-12.The graph above,depicts supply and demand for U.S.dollars during a trading day.At a fixed exchange rate of 0.30 pounds per dollar,the dollar is ________ versus the pound.A ________ of the dollar would correct the fundamental disequilibrium that exists in this market.

• A)undervalued; devaluation
• B)undervalued; revaluation
• C)overvalued; revaluation
• D)overvalued; devaluation

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Definitions:

Inventory Account

An account on a company’s balance sheet that represents the value of the goods that are ready for sale but have not yet been sold.

Consolidation Adjustment

Adjustments made during the preparation of consolidated financial statements to eliminate the effects of inter-company transactions among entities within a single group.

Contingent Liability

A liability that may occur depending on the outcome of a future event.

Business Combination Valuation Entries

Journal entries made in accounting to record the assets and liabilities at their fair values in a business acquisition.