With dramatic swings in exchange rates,particularly in a freely floating exchange rate regime,setting prices for internationally traded goods is a challenge for international business management.The extent to which an international business adjusts prices in a foreign market as the result of an exchange rate change is called:
A)exchange rate decision.
B)exchange rate pass-through.
C)the bandwagon effect.
D)the nominal interest rate differentials effect.

Question

Quizplus · Accepted Answer

The extent to which an international business adjusts prices in response to changes in exchange rates is called exchange rate pass-through. This is a common decision faced by international businesses as they navigate the challenges of setting prices in foreign markets. The other options listed are not directly related to this concept.

With Dramatic Swings in Exchange Rates,particularly in a Freely Floating