Question

All import charges are assessed against the

A) ex-works price.
B) rigid cost-plus price.
C) estimated future cost price
D) flexible cost-plus price
E) landed price

Answer 1

A country for which imports and exports comprise a large fraction of the GDP is more likely to adopt a flexible exchange rate.

Step-by-step explanation:

A country for which imports and exports comprise a large fraction of the GDP is more likely to adopt a flexible exchange rate. When imports and exports make up a significant portion of a country's GDP, the value of its currency becomes sensitive to changes in international trade. A flexible exchange rate allows the currency to adjust based on supply and demand factors, which helps maintain competitiveness in the global market.

On the other hand, a fixed (hard peg) exchange rate is less likely to be adopted by a country heavily dependent on imports and exports, as it can lead to imbalances and disruptions in international trade.