Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

i need to know if the answers a correct? The exchange rate rose from 98.46 yen/S a year ago to 113.48 yen/S today, A) the

image text in transcribed i need to know if the answers a correct?

The exchange rate rose from 98.46 yen/S a year ago to 113.48 yen/S today, A) the dollar has appreciated, and the yen has appreciated B) the dollar has depreciated, and the yen has depreciated C) the dollar has deprecated, and the yen has appreciated D) the dollar has appreciated, and the yen has depreciated If Chinese Yuan becomes weaker relative to US dollar, it would A) discourage US exports, and benefits US consumers B) discourage US exports, and hurts US consumers C) encourage US exports, and benefits US consumers D) encourage US exports, and hurts US consumers A U.S. firm has borrowed pound 50 million from a British firm. The borrower will need to convert dollars to pounds to repay the loan when it is due. The U.S. firm could hedge the exchange rate risk by A) Buying pounds forward B) Selling pounds forward C) Borrowing pounds D) Buying dollars forward E) Borrowing dollars A Swiss bank converted 1 million Swiss francs to euro to make a euro loan to a customer when the exchange rate was 1.75 Swiss francs per euro. The borrower agreed to repay the principle plus 4% interest in 1 year. The borrower repaid the exchange rate was 1.65 Swiss francs per euro. What was the bank's Swiss francs rate return? A) 10.30% B) 7.75% C) 4.58% D) -1.94% E) 0% In the previous question, if the Swiss bank had hedged its foreign exchange rate risk by selling one-year euro loan proceeds in forward foreign exchange market at 1.85 francs per euro. was the Swiss bank's franc rate of return? A) 4.75% B) 7.62% C) 9.94% D) 2.43% E) -1.62%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance Led Capitalism Shadow Banking Re Regulation And The Future Of Global Markets

Authors: Robert Guttmann

1st Edition

1137398566, 978-1137398567

More Books

Students also viewed these Finance questions