In order to buy goods from another country the importer must pay with
A. a combination of its own currency and the currency of the country from which it is buying the goods.
B. the currency of the country from which it is buying the goods that it has arranged to get through the foreign exchange market.
C. the currency of the country from which it is buying the goods, and they must have been holding the currency from a previous transaction.
D. its own currency.
Answer: B
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A firm faces a small number of competitors. This firm is competing in
A) a monopoly. B) monopolistic competition. C) an oligopoly. D) perfect competition. E) a perfect multi-firm monopoly.
If the central bank targets the interest rate, it
a. must decrease interest rates in response to an increase in money demand. b. rules out the possibility of runaway inflation. b. can lead to runaway inflation if maintained too rigidly. d. Both a and c e. Both b and c
How can the concepts of opportunity costs, scarcity and choice be illustrated by the production possibilities curve?
What will be an ideal response?
During a recession unemployment benefits rise. This rise in benefits makes aggregate demand higher than otherwise
a. True b. False Indicate whether the statement is true or false