The shift in focus toward imperfectly competitive markets in domestic and international trade questions the concept of:
A) Official exchange rates
B) Complete currency pass-through
C) Exchange arbitrage
D) Trade-adjustment assistance

Question

Quizplus · Accepted Answer

The concept of complete currency pass-through assumes that changes in exchange rates are fully reflected in the prices of imported and exported goods. In imperfectly competitive markets, firms may not fully adjust their prices in response to exchange rate changes, challenging this concept.

The Shift in Focus Toward Imperfectly Competitive Markets in Domestic