24) The "balance of payments" is a record of all economic transactions between the residents of a country and the developed countries of the Answer: FALSE 25) A country with a positive current account balance has a trade deficit; that is, the outflow of money to pay for imports exceeds the inflow of money for sales of exports. Answer: FALSE 26) The important fact to recognize about the overall balance of payments is that it is always in balance, although imbalances do occur in subsets of the overall balance. Answer: TRUE 27) The foreign exchange market consists literally of a and a seller's market where currencies are traded for both spot and future delivery on a continuous basis. The market forward is for immediate delivery and the market is for future delivery. spot Answer: FALSE 28) When a company conducts business across boundaries in countries with different currencies, it is thrust into the turbulent world of exchange risk. Answer: TRUE 29) A country's currency would be overvalued if the Big Mac price (converted to dollars) is lower than the U.S. price. Answer: 30) Hedging exchange rate exposure involves establishing an offsetting currency position such that the loss or gain of one currency position is offset by a corresponding gain or loss in some other currency. Answer: TRUE 31) During the past two decades, the world economic environment has become increasingly dynamic. To achieve success, executives and marketers must take into account all of the following realities except: A) capital movements have replaced trade as the driving force of the world economy. B) production has become "uncoupled" from employment. C) the economy dominates the scene. D) the struggle between capitalism and socialism continues. E) the growth of e-commerce diminishes the importance of national barriers. Answer: D
24) The "balance of payments" is a record of all economic transactions between the residents of a country and the developed countries of the Answer: FALSE 25) A country with a positive current account balance has a trade deficit; that is, the outflow of money to pay for imports exceeds the inflow of money for sales of exports. Answer: FALSE 26) The important fact to recognize about the overall balance of payments is that it is always in balance, although imbalances do occur in subsets of the overall balance. Answer: TRUE 27) The foreign exchange market consists literally of a and a seller's market where currencies are traded for both spot and future delivery on a continuous basis. The forward market is for immediate delivery and the spot market is for future delivery. Answer: FALSE 28) When a company conducts business across boundaries in countries with different currencies, it is thrust into the turbulent world of exchange risk. Answer: TRUE 29) A country's currency would be overvalued if the Big Mac price (converted to dollars) is lower than the U.S. price. Answer: 30) Hedging exchange rate exposure involves establishing an offsetting currency position such that the loss or gain of one currency position is offset by a corresponding gain or loss in some other currency. Answer: TRUE 31) During the past two decades, the world economic environment has become increasingly dynamic. To achieve success, executives and marketers must take into account all of the following realities except: A) capital movements have replaced trade as the driving force of the world economy. B) production has become "uncoupled" from employment. C) the economy dominates the scene. D) the struggle between capitalism and socialism continues. E) the growth of e-commerce diminishes the importance of national barriers. Answer: D
The%20global%20economic%20environment.docx