What are the information costs associated with forward contracts?
What will be an ideal response?
As a result of counterparty risk, buyers and sellers of forward contracts will incur information
costs when analyzing the creditworthiness of potential trading partners.
You might also like to view...
An increase in real income with constant prices and domestic credit leads to the same effects under both fixed and purely flexible exchange rates
Indicate whether the statement is true or false
A downside to foreign aid is that
a. developing countries have not necessarily increased their ability to become self-supporting at higher standards of living b. many recipient countries are doing less of what they had done well c. the agricultural sectors of recipient countries have suffered d. government officials have been insulated from their own incompetence e. All of the answers are correct
Actions that reduce trade restrictions and promote free trade are often referred to as:
A. trade liberalization. B. trade protectionism. C. free trade politicism. D. autarky.
The AD curve shows that as price increases, amount demanded will _________.
Fill in the blank(s) with the appropriate word(s).