Question

Why are currency exchange systems important for international trade?

A. They make it more difficult for countries to impose tariffs on foreign goods
B. They make it more difficult for smugglers to sell foreign goods. They make it easier for people who speak different languages to trade with each other.
C. They make it easier for people who speak different languages to trade with each other.
D. They make it easier for countries with different kinds of money to trade with each other.

Answer 1

The currency exchange system is important for international trade because it facilitates trade between countries with different kinds of money.

Step-by-step explanation:

The currency exchange system is important for international trade because it facilitates trade between countries with different kinds of money.

When countries have different currencies, it can be challenging to determine the value of goods and services in each currency. The currency exchange system allows for the conversion of one currency into another, making it easier for countries to trade with each other.

For example, if a country uses the US dollar as its currency and wants to import goods from a country that uses the euro, the currency exchange system allows the conversion of US dollars into euros, enabling the trade to happen smoothly.