Asked by
chass krenke
on Nov 07, 2024
Verified
Which one of the following statements is correct assuming that exchange rates are quoted as units of foreign currency per dollar?
A) The exchange rate moves opposite to the value of the dollar.
B) The exchange rate rises when the Canadian inflation rate is higher than the foreign country's.
C) When a foreign currency appreciates in value it strengthens relative to the dollar.
D) The exchange rate falls as the dollar strengthens.
E) The exchange rate is unaffected by differences in the inflation rates of the two countries.
Foreign Currency
Money or legal tender issued by a country that is not the domestic currency where a particular transaction is taking place.
Exchange Rates
The rate at which one currency is exchanged for another, indicating the quantity of one currency that can be traded for another.
Appreciates
Describes when the value of an asset increases over time in comparison to its original cost.
- Acquire knowledge on elementary notions associated with exchange rates, encompassing the computation of currency conversions and the assessment of exchange rate trends.
Verified Answer
JJ
Learning Objectives
- Acquire knowledge on elementary notions associated with exchange rates, encompassing the computation of currency conversions and the assessment of exchange rate trends.