Question

Time remaining 59:55, it's important for countries to exchange currencies so that goods from other nations can be ________.

1) manufactured
2) destroyed
3) traded
4) regulated

Answer 1

Countries exchange currencies to enable international trade and the correct answer is that goods from other nations can be traded. Exchange rates affect trade flows and economic strategies.

Step-by-step explanation:

It's important for countries to exchange currencies so that goods from other nations can be traded. This process involves the foreign exchange market where currencies are converted, allowing international trade to occur efficiently. Exchange rates— the price of one currency relative to another—play a crucial role in this system. A stable exchange rate facilitates trade by reducing risk and uncertainty, whereas variations can disturb international trade flows.

While some nations adopt a common currency, like the euro in Europe, or use a larger neighbor's currency, most global trade involves multiple national currencies. Governments might manipulate their currency value or exchange rate policies, seeking to balance economic objectives such as stimulating demand or controlling inflation. Ultimately, the exchange of currencies is vital to engage in global trade and economic activities across borders.