Conversions

International transactions require conversions between currencies.

• True

• False

What is the primary purpose of currency conversion in international trade?

• To increase the value of money

• To facilitate trade between countries

• To avoid taxes

• To create inflation

Which organization is responsible for setting international currency conversion standards?

• World Bank

• International Monetary Fund (IMF)

• United Nations

• World Trade Organization

Currency conversion rates are influenced by which of the following factors?

• Weather conditions

• Political stability

• Population size

• Geographical location

What is the term for the difference between the buying and selling price of a currency?

• Exchange rate

• Spread

• Margin

• Conversion fee

Which of the following is a common method for individuals to convert currency?

• Using a stock exchange

• Visiting a bank or currency exchange

• Applying for a loan

• Investing in real estate

What is the impact of a strong domestic currency on exports?

• Increases export competitiveness

• Decreases export competitiveness

• Has no effect

• Leads to higher import tariffs

Which currency is often used as a global benchmark for conversions?

• Euro

• Japanese Yen

• British Pound

• US Dollar

What is the role of a foreign exchange market?

• To regulate international travel

• To facilitate currency conversion

• To control global inflation

• To manage international loans

How does inflation affect currency conversion rates?

• Increases the value of currency

• Decreases the value of currency

• Has no effect

• Stabilizes the currency