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7 Cards in this Set
- Front
- Back
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Which of the following will help a company hedge against currency fluctuations?
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Dispersing production to different geographic locations
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When two parties agree to exchange currency and execute the deal immediately, the transaction is a:
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spot exchange
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International businesses use the foreign exchange markets for all of the following reasons except:
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to cover themselves from all risks involved in currency speculation
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Which of the following is NOT a cause for banking, foreign debt, and/or currency crises?
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Low relative price inflation
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The Bretton Woods system, designed at the height of World War II, established two multinational organizations that would help shape events throughout the second half of the 20th Century and beyond. These organizations were:
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the United Nations and the International Monetary Fund
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A foreign debt crisis:
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is a situation in which a country cannot service its debt obligations.
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The _____ suggests that given relatively efficient markets, the price of a "basket of goods" should be roughly equivalent in each country.
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purchasing power parity theory
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