5. The authors of our text discuss the concept of the "Impossible Trinity" or the inability to achieve simultaneously the goals of exchange rate stability, full financial integration, and monetary independence. If a country chooses to have a pure float exchange rate regime, which two of the three goals is a country most able to achieve?
(a) Monetary independence and exchange rate stability
(b) Exchange rate stability and full financial integration
(c) Full financial integration and monetary independence
(d) A country cannot attain any of the exchange rate goals with a pure float exchange rate regime
6. Sony of Japan produces DVD players and exports them to the United States. Last year the exchange rate was ¥130/$ and Sony charged $150 per DVD player. Currently the spot exchange rate is ¥110/$ and Sony is charging $170 per DVD player. What is the degree of pass through by Sony of Japan on their DVD players?
Q5 (a) Monetary independence and exchange rate stability
Q6 Last year ...
Answer two MCQs on Multinational Business Finance.
The Gold Standard and Foreign Exchange Markets Summary
As fluctuating currency rates are an important aspect of international dealings, knowing how foreign exchange markets function will help ensure your success in the international business. Keep in mind the history of the gold standard for this question.
Scenario: You have been asked by a local college to write a lecture that explains the gold standard and addresses the functions of the world's major foreign exchange markets. Write a summary detailing the functions of the world's major foreign currency exchange markets. Be sure to discuss the positive and negative aspects of using a gold standard.View Full Posting Details