Question

the 45 Charter, the with road s when the charts El to e. Yohappy with your 20 percent thes and your f or you only ER-505. This was example of w in the della market imperfections tors become aware of overseas Investment opportunities and are et imperfection information symmetry.for another, exchange >> When individual investors bee nato diversity their portfolios internationally A) they trade one market imperfe rate risk they should invest only in dollars or euros. they benefit from an expanded opportunity set D) they should not bother to read or to written in a foreign language. Dother to read or to understand the prospectus, since it's proba While the corporate governance problem is not confined to the one the U.S. legal system, with lawsuits used only as a last resort, ensure conflicts of interest would soon be a thing of the past B) it has reached its high point in the United States. can actually be a much more serious problem in other parts of the wond the legal protection of shareholders is weak or nonexistent. D) none of the options lem in other parts of the world, where 4) Suppose that country A is twice as good at producing widgets as country B. 11 the currency of B is twice as valuable as the currency of A, A) the comparative advantage could be canceled out. B) trade will be an improved outcome for both A and B. o the comparative advantage will shift to an absolute advantage. D) none of the options 5) Country A can produce 10 yards of textiles or 6 pounds of food per unit of input. Country B can produce 8 yards of textiles or 5 pounds of food per unit of input. Which of the following statements is true? A) Country B is relatively more efficient than Country A in the production of textiles. B) Country A is relatively more efficient than Country B in the production of food. Country A is relatively more efficient than Country B in the production of textiles. D) none of the options nder the gold standard, international imbalances of payment will be corrected tomatically under the 1) Price-specie-flow mechanism. B) Bretton Woods Accord. Gresham Exchange Rate regime. D) European Monetary System.

Answer 1

1. C Exchange rate risk

2.C Expanded opportunity set

3.C

4.B Trade will be an improved outcome for A & B

5.D

6.A