HORIZON COLLEGE INTERNATIONAL

BUSINESS –YEAR 10

WORK SHEET 7-T3W8

NAME:…………………………… CLASS: …………………….. MARKS

INTERNATIONAL TRADE AND EXCHANGE RATES

01. Define the term exchange rate.

02. Define the term trade bloc.

03. Explain one reason for international trade.

04. A US firm buys 150 kilograms (kgs) of yeast from Germany at a cost of €2 250. The exchange rate is

€1 = US$ 5. How much does US firm pay in USD for the yeast?

05. The exchange rate has increased from €1 = US$ 5 to US$ 8. How much does US firm pay in USD for

the yeast at new exchange rate?

06. Analyse the likely effects on US firm if the value of the € (Euros) increases.

Business, Y10 – T3W8 Page 1 of 1