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CHAPTER 9 - Answer
CHAPTER 9 - Answer
CHAPTER 9
INTERNATIONAL TRADE
I. Questions
1. Factors affecting the value of a currency are (1) inflation, (2) interest
rates, (3) balance of payments, and (4) government intervention or
policies. Other factors that have an influence include the stock market,
gold prices, demand for oil, political turmoil and labor strikes. All of the
above factors will not affect each currency in the same way at any given
point in time.
3. The spot rate for a currency is the exchange rate at which the currency is
traded for immediate delivery. An exchange rate established for future
delivery is a forward rate.
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Chapter 9 International Trade
1. C 12. A 23. A
2. D 13. C 24. B
3. D 14. C 25. A
4. B 15. B 26. C
5. B 16. D 27. D
6. B 17. C 28. C
7. D 18. D 29. D
8. B 19. B 30. A
9. C 20. A 31. A
10. A 21. C 32. C
11. D 22. B
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