Question
A US bank issued $200 million worth of one-year CD liabilities in Japanese yens at a rate of 6%. The original spot exchange rate at
A US bank issued $200 million worth of one-year CD liabilities in Japanese yens at a rate of 6%. The original spot exchange rate at the time of the transaction was $0.0080/1.
What will be the US dollar cost rate on this CD if the US dollar depreciates relative to the yen such that the exchange rate at the end of the year is $0.0090/1?
19.25%
18.50%
16.53%
13.48%
15.45%
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Accounting Information For Business Decisions
Authors: Billie Cunningham, Loren A. Nikolai, John Bazley, Marie Kavanagh, Geoff Slaughter, Sharelle Simmons
2nd Edition
0170253708, 978-0170253703
