Asked by sumara sultan on Jul 04, 2024
Verified
ABC Corp., a U.S.-based company, is signing a business deal with Syphed Inc., a company based in the country of Yanghor. The base currency for the deal is the U.S. dollar. The counter currency for the transactions between the two companies is Yang, the official currency of Yanghor. To be able to conduct business in Yanghor, ABC Corp. should identify how much of U.S. dollars will be required to buy an equivalent amount of purchasing power in Yang. In short, ABC Corp. needs to identify the _____ of the currency of Yanghor.
A) equity value
B) capital share
C) exchange rate
D) dividend
Exchange Rate
The value of one currency when being converted to another currency.
Base Currency
The currency against which exchange rates are generally quoted in a given country, typically the currency of the home market.
Counter Currency
The second currency listed in a foreign exchange rate transaction, which can be bought or sold relative to the base currency.
- Apprehend the significance and method of currency exchange in the realm of international trade.
Verified Answer
RT
Rodney ThompsonJul 10, 2024
Final Answer :
C
Explanation :
The correct term is "exchange rate," which refers to the value of one currency for the purpose of conversion to another. In this context, ABC Corp. needs to know the exchange rate to determine how many U.S. dollars are needed to purchase an equivalent amount of Yang.
Learning Objectives
- Apprehend the significance and method of currency exchange in the realm of international trade.