Question
6. On behalf of CFO Homan, complete the following table, indicating, which currency has appreciated (denoted 'A) and which currency has depreciated (denoted 'B'). NOTE:
6. On behalf of CFO Homan, complete the following table, indicating, which currency has appreciated
(denoted 'A") and which currency has depreciated (denoted 'B').
NOTE: You have been given a mixture of direct and indirect quotes
o
8. Volkswagen may ultimately choose a plant outside of the ones listed in Question 6, opting for the country
Forinta - where the local currency is the forints. The projected investment and returns are as follows:
_ What would be their total total investment (in dollars)?
_ Once the plant is up and running, what would the annual percentage return on investment?
_ If the forint is devalued by 25 percent., what would the new exchange rate be?
DATE EXCHANGE RATE CURRENCY TO CONSIDER APPRECIATED (A) DEPRECIATED D) 4/24/2005 0.91130 EUR USD EUR 4/28/2005 0.90630 EUR/USD 6/17/2005 23.2 BHT USD BHT 1/13/2006 55.8 BHT USD 4/25/2005 1.6430 CHF/USD CHF 4/26/2006 0.6140 USD CHF 6/26/2004 0.0008324 USD/KRW KRW 2/18/2005 0.0008286 USD/KRW 1/30/2006 1.0038 ARS/USD USD 2/5/2006 1.00050 USD ARS Purchase price: Additional investment required: Projected Hungarian sales: Projected earnings Exchange rate: 30 billion forints 50 million USD. All imported equipment priced in USD. 45 billion forints 4.5 billion forints. 300 forints/USD
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