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Exchange Rates

Working Capital

What are some of the metrics you would recommend to monitor effective working capital management for inventory? How would you implement them?

Expected exchange rate.

The current exchange rate between the Japanese yen and the U.S. dollar is 120 yen per dollar. If the dollar is expected to depreciate by 10% relative to the yen, what is the new expected exchange rate?

Exchange Rate Calculations and Exchange Rate Risk

Consider the following illustrative exchange rates: U.S. Dollars Required to Buy One Unit of Foreign Currency Japanese yen 0.009 Australian dollar 0.650 Assume Citrus Products can produce a liter of orange juice and ship it to Japan for $1.75. If the firm wants a 50 percent markup on the product, what should th

Growth Rate Estimation

Almost two million persons per year visit Glacier National Park. Due to the weather, monthly park attendance figures varied widely during the most recent year: (See Attached Chart). 1) Notice that park attendance is lower in December than in January, despite a 42.4 percent average growth rate in monthly attendance. How is th

A U.S Corporation as a subsidiary in Netherlands.

A U.S Corporation as a subsidiary in Netherlands. It is deciding whether to invest 2 millions from the parent's funds in a 3 year project in the Netherlands. the after tax cash flows to the subsidiary are estimated to be as follows (in euros): Year 1 500.000 year 2 800,000 Year 3 900,000 The entire cash flows

Exchange Rates Research

I need help completing the following task. I've attached the information needed for this particular assignment. You are the chief executive officer of a multinational's subsidiary in a developing host country. The subsidiary has been in business for about eight years, making electric motors for the host country's domestic ma

Annual Return, Variance and Standard Deviation

1) From the following information, compute the average annual return, the variance, standard deviation,and coefficient of variation for each asset. Asset Annual Returns A 5%, 10%, 15%, 4% B -6%, 20%, 2%, -5%, 10% C 12%,15%, 17%

Conditions of covered and uncovered interest parity

This is a sample Question, please provide an answer and explanation. Explain how the conditions of covered interest parity and uncovered interest parity are reached, and indicate the implications of the analysis for the prediction of the future spot rate.

Time value comparisions of single amounts

In exchange for a $20,000 payment today, a well known company will allow you to choose one of the alternatives shown in the following table. Your opportunity cost is 11%. Alternative Single Amount A $28,500 at end of 3 years B $54,000 at end of 9 years C

Value of a Call Option using Black Scholes Equation

Assume that the spot price of the British pound is $1.55, the annualized 30-day sterling interest rate is 10%, the annualized 30-day U.S. interest rate is 8.5%, and the annualized standard deviation of the dollar:pound exchange rate is 17%. Calculate the value of a 30-day PHLX call option on the pound at a strike price of $1.57

Depreciation of US Dollar

The Yen-Dollar Exchange Rate The Federal Reserve Board of Governors provides exchange rates for various currencies for the last decade at www.ferderalreserve.gov/ releases (Foreign Exchange Rates: Historical bilateral rates). Has the dollar appreciated, depreciated, or remained constant relative to the Canadian dollar, the Europ

Bretton Woods exchange rates

Suppose that under the Bretton Woods system, the dollar is pegged to gold at a rate of $35 per ounce and the pound sterling is pegged to the dollar at a rate of $2 = £1. If the dollar is devalued against gold and the pegged rate is changed to $40 per ounce, what does this imply for the exchange value of the pound? Explain your

Identify and describe the effect of changing the savings rate on consumption.

Dear OTA: Please try to do the following for me. There is an attachment to this that has the info needed to answer these questions. I sincerely appreciate your help as I cannot calculate this information out. :-( ? Identify and describe the effect of changing the savings rate on consumption. ? Calculate the marginal prop

Exchange Rates & Balance

A) Following the decrease in the demand for the Baht, has the Baht appreciated or depreciated in relation to the US dollar? B) Suppose that the Bank of Thailand desires to push the equilibrium exchange rate back to a value of $.27 per Baht. How could the Bank of Thailand accomplish this objective by inducing the demand for Ba

Floating exchange rate: effect of US inflation, major discoveries of the highest quality diamonds ever found occur in Russia & Central Asia, causing a significant decline in purchases of South African diamonds on Rand; decrease in the demand for the baht

Explain how the following events would effect the market for South Africa's currency, the rand, assuming a floating exchange rate. a) a rise in the US inflation causes many US residents to seek to buy gold, which is a major South African export, as hedge is against inflation. The rand appreciates The rand does not

A quota is

I am stuck on the following multiple choice questions. Could someone please help? Thanks so much:) 11. A quota is a. a tariff on exports b. a quantitative limit on the amount of a good that may be imported c. the same as a non-prohibitive tariff d. the amount of exports a country needs to finance its imports e. a per-un

IS and LM curves

Given the following parameters for an open economy open economy where C=10+.8(y-T); I=10 G=10 T=10 and imports and exports are given by IM=.3Y and X=.3Y* respectively where Y is foreign output. Provide an equation that resolves to the lowest level. Given Y*. What is the mulipier effect of this open economy? Explain the be

Suppose the dollar-pound rate equals $0.5 per pound.

Suppose the dollar-pound rate equals $0.5 per pound. According the purchasing power parity theory, what will happen to the dollar's exchange rate under each of the following scenarios ? a) The U.S. price level increases by 10% and price level in Britain stays constant b) The U.S. price level increases by 10%, while price le

Economics in a Global Environment - Federal Reserve

Please Use Original Work 1-2 pages Details: Describe three ways in which the Federal Reserve can change the money supply. If the Federal Reserve is going to adjust all of these tools during an economy that is growing too quickly, what changes would they make? If the Federal Reserve is going to adjust all of these t

Economics Problems - Multiple Choice

33. In the rate process, the determination of the __________________ has historically been somewhat neglected in relation to the other steps in the process. a. Rate structure. b. Rate level. c. Allowable operating costs. d. Rate base. e. Allowable rate of return. 43. An illustration of a non-credible commitment is the

Economic Review Questions

Please help provide the correct term for the following statements. Only the term is needed. 1. The price at which an investor will sell a security. The price a buyer is willing to pay for a security is the bid. The difference between the ask and bid price is the spread. 2. A market in which prices are in an upw

CALCULATING NPV

1) The Great Computer Company, a U.S. corporation, has a subsidiary in the Netherlands. It is deciding whether to invest $2 million of its (the parent's) funds in a 3 year project in the Netherlands. The after-tax cash flows to the subsidiary are estimated to be as follows (in euros). Year 1 ?500,000 Year 2 800,0

Multiple choice economics questions

Aggregate demand slopes downward because a. there are always substitute goods for anything. b. of diminishing marginal utility. c. of the effect of higher prices on consumers' wealth. d. foreign goods can substitute for domestic goods.

Economics

Suppose the spot exchange rate is $2.00 per euro and that the annual interest rate on one-year government bond is 10 percent in the U.S. and 8 percent in Germany. a. If you expect the spot price of the euro to be $2.00 in one year, where will you invest? Explain b. In order for investors to be