IGCSE Development Studies: Specimen Questions with Answers 53 - 54 of 98

Question 53 (3 of 7 Based on Passage)

Short Answer▾

Name the products imported and exported by US

Imports of US from China and Exports of US to China
Imports of US from China	Exports of US to China
Telephone for cellular networks or for other wireless networks	Aero planes and other aircrafts
Automatic data processing machine	Soya beans
Tricycle, scooters and similar wheeled toys and other toys	Vehicles with only spark ignition, internal combustion reciprocating piston engine
Communication apparatus	Electronics, integrated circuits, processors, and controllers

Short Answer▾

Explain three ways in which company earns foreign exchange

Fixed exchange rate: Fixed exchange rate is the standard exchange rate set by the monetary authorities for one or more currencies. It provides stability that helps to control inflation and keeps the unit labor cost low. There are chances of less speculation if fixed exchange rate is prevailing in the market.
Floating Exchange rate: Under the floating exchange rate, factors of supply and demand decide the value of currency. It gives freedom to set policy interest rates to meet the domestic objectives. It may also help to prevent imported inflation.