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Evaluate each of the following statements having to do with the international foreign exchange markets, then select the best answer from the lettered choices below.
1) Without the foreign exchange markets (by which citizens all over the world acquire the foreign money they need for purchases of the goods of foreign nations) international trade would not be possible.
2) The exchange rates in the international foreign exchange markets track the trade currency ratios of internationally traded claims more closely than the trade currency ratios of internationally traded goods.
A) Only statement 1 is true.
B) Only statement 2 is true.
C) Both statements 1 and 2 are true.
D) Neither statement 1 nor 2 is true.
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