Multiple Choice
A tax designed to reduce the disparities in wealth between the rich and poor is called a(n):
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0. Basic Principles of Economics
Introduction to Economics
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
People or firms use one currency to purchase another currency at the:
A
labor market
B
stock exchange
C
foreign exchange market
D
commodity market
Verified step by step guidance1
Understand the context: The problem asks where people or firms exchange one currency for another, which involves currency trading.
Recall the definition of the foreign exchange market: It is a global marketplace where currencies are bought and sold, facilitating international trade and investment.
Identify the other options: The labor market deals with employment and wages, the stock exchange deals with buying and selling stocks, and the commodity market deals with raw materials and goods.
Compare the options with the activity of currency exchange: Only the foreign exchange market specifically handles currency transactions.
Conclude that the correct place for currency exchange is the foreign exchange market, as it is the specialized market for trading currencies.
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