With regard to exchange rates, it is correct to say that
A) they affect trade balances.
B) they typically vary substantially on a daily basis.
C) they do not vary with market conditions.
D) changes affect only narrow product lines, not all products.
E) as the value of a country's currency falls, foreign companies have less incentive to ship products into that country.

Question

Quizplus · Accepted Answer

Exchange rates affect trade balances because they influence the cost of exports and imports, impacting the trade deficit or surplus.

With Regard to Exchange Rates, It Is Correct to Say