Multinational Corporations and Exchange Rates Quiz
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Questions and Answers

What is the term used to describe a decline in a currency's value?

  • Appreciation
  • Depreciation (correct)
  • Devaluation
  • Revaluation

    • How are spot rates at two specific points in time denoted?

  • A and B
  • R and T
  • S and St-1 (correct)
  • X and Y

    • How do exchange rate movements affect an MNC's value in terms of cash inflows and outflows?

  • They only affect the amount of cash outflows needed to pay for imports.
  • They only affect the amount of cash inflows received from exporting.
  • They do not affect cash inflows or outflows.
  • They can affect the amount of cash inflows received from exporting or from a subsidiary and the amount of cash outflows needed to pay for imports. (correct)

    • What does an increase in a currency's value relative to another currency refer to?

    <p>Appreciation</p> Signup and view all the answers

    What is the term used to describe an increase in the value of one currency in units of another currency?

    <p>Appreciation</p> Signup and view all the answers

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