Answer: The answer is there is a connection between floating rate system and trade balance.
Explanation:
Floating exchange rate can be said to be a situation in which the exchange rate is allowed to move freely in response to the forces of demand and supply.The higher the demand for the currency the lower the supply for the currency. The higher will be the value of such currency in terms of other currency, a currency is demanded for the purchase of goods and services and for the purpose of investment. The investment we are talking about may be a long term investment or a short term investment. For example when a foreign company build a factory for the production of goods in another foreign countries.
The exchange rate in a free market economy is determined by the interaction of demand and supply. Demand for a particular currency is an indication of the export for the goods and services produced in such a country,in the sense that people that want to buy the export goods of a country will need the country currency to do so. On the other hand, the supply of a country's currency is determined by the amount of import of a country as the country's importers need to change their local currency to a foreign currency to be able to import foreign made goods into their country. For example if a Nigerian importer wants to import goods from United States to Nigeria such an importer will have to change the Nigerian Naira to United States dollar to be able to import such goods because payments for such a goods will be done in dollars.
The floating exchange rate help to adjust trade imbalance, in the sense that a country will import goods from a particular country in spite of their local production in other to ensure that the country other countries continues to purchase the country goods. A country can also use a floating exchange rate to keep inflation rate low when a country import goods that they can produced locally if their cost of Production is cheaper abroad than in their home country.this will ensure that the prices of the goods will be affordable for the consumers to buy, because the prices of such goods will be low.
Answer: a. a credit to Accounts Payable.
Explanation:
When paying off a note, cash will be used so cash will have to be credited to show that it is decreasing.
Interest expense will be debited by the interest accumulated on the loan because expenses are debited when they increase.
Notes Payable will be debited to show that the note has now been retired.
There is no credit for Accounts payable involved in this transaction.
Answer: A. He will quite certainly gain approval since the project has a positive net present value.
Explanation:
The options are:
A. He will quite certainly gain approval since the project has a positive net present value.
B. Approval is probable but not likely as he failed to account for the time value of money.
C. He will not gain approval as he failed to consider whether the project is leading edge or not.
D. Approval is probable but not likely as the project has been constructed on estimates instead of facts.
Capital budgeting is used to know whether the long term investment for a particular organization's is actually worth investing in or not by the company.
Based on the scenario in the question, since the present value of the estimated future cash flows is greater than the cost of the project, Ashton will quite certainly gain approval since the project has a positive net present value.
<span>agreement to modify an existing contract would be the answer</span>
Circular flow is a model of economy in which major exchanges are showed as flow of money, food, goods, services and etc between economic agents. In circular flow, the flows of money and goods exchanges in a closed circuit but runs oppositely. Circular flow analysis is the basis of national accounts.
