1 You have $10,000 to invest in a corporate bond. It pays four times a year at...
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Question:
1 You have $10,000 to invest in a corporate bond. It pays four times a year at 5% interest rate and compounding quarterly. How much money you will have in one year?
2 A US company designs its products in US but manufactures those products in China.
- What type of currency exposure the US Company will face?
- List three strategies to manage the operation exposure, and explain how they can be used to hedge the operation exposure.
3 A US company has a manufacturing subsidiary in Brazil and it categorizes Brazilian Real as the functional currency.
- Explains the concept of functional currency;
- Under US accounting, what currency translation method it will use for this subsidiary?
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