Question
Now assume that the FX exchange rate changes to $1.00/MXN24.575 at the same time that interest rates change. Whichof the following is most correct ?
Now assume that the FX exchange rate changes to $1.00/MXN24.575 at the same time that interest rates change. Whichof the following is most correct ?
a. The MXN depreciated in value against the US dollar, ad the firm loses equity value due to its FX exposure
b. The MXN appreciated in value against the US dollar, and the firm loses equity value due to its FX exposure
c. The MXN depreciated in value against the US dollar , and the firm gains equity value due to its FX exposure
d. The MXN appreciated in value against the US dollar, and the firm gains equity value due to its FX exposure
e. none of the above is correct
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