Interest Rates and Exchange Rates Quiz
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Questions and Answers

How do fluctuating exchange rates affect a company's ability to pay suppliers?

  • It can affect the company's profit margin and the amount of resources needed (correct)
  • It always leads to increased costs for the company
  • It has no impact on the company's ability to pay suppliers
  • It only affects the company's ability to secure new suppliers
  • What is a potential consequence of an economic depression?

  • Stable employment rates and growth of businesses
  • Decrease in unemployment rates and increase in business startups
  • Rise in unemployment rates and closure of businesses (correct)
  • Improved health services and increase in GNP growth rates
  • Why are banking institutions interested in knowing the status of interest rates in the economy?

  • To directly control interest rates
  • To determine their lending practices (correct)
  • To predict stock market movements
  • To influence government policies
  • How does economic sluggishness affect the demand and supply in the economy?

    <p>It can cause the demand and supply not to grow</p> Signup and view all the answers

    What impact does a recession have on consumer purchasing decisions?

    <p>It may force companies to drop prices to stay afloat</p> Signup and view all the answers

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