Author Question: Assume an Australian importer expects to pay 16,000 Australian dollars (AUD) for 8,000 worth of U.S. ... (Read 103 times)

RYAN BANYAN · **on:** Jun 30, 2018

Assume an Australian importer expects to pay 16,000 Australian dollars (AUD) for 8,000 worth of U.S. goods, but on the shipment date 30 days later, the same volume of U.S. goods costs the Australian importer only 10,000 Australian dollars. This means that between the contract date and the payment date, the exchange rate has changed:
a. from 1 = 1.25 AUD to 1 = 2.0 AUD.
b. from 1 = 2.0 AUD to 1 = 1.25 AUD.
c. from 1 = 0.8 AUD to 1 = 0.5 AUD.
d. from 1 = 0.5 AUD to 1 = 0.8 AUD.
e. from 1 = 0.5 AUD to 1 = 2.0 AUD.

Question 2

The U.S. balance of trade:
a. typically is positive since the United States exports far more goods than it imports.
b. is the difference between merchandise exports and merchandise imports.
c. includes net military transactions.
d. Both b. and c. are correct.