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Questions 1: Assume that you are an Omani investor and you have invested in Indian Government bonds (denominated in Indian Rupee) which pays you fixed
Questions 1: Assume that you are an Omani investor and you have invested in Indian Government bonds (denominated in Indian Rupee) which pays you fixed coupon rate. Also, assume that during your investment period, the Omani Rial (OMR) has significantly depreciated against Indian Rupee. How would it affect your cash flows in Oman? (1 point) Questions 2: Assume that you are the CFO of Microsoft Corporation, which mainly sells its products in developing economies. During a given year, the US dollar has significantly appreciated against the basket of developing economies' currencies. How would it affect the Microsoft's income, which is headquartered in the US? (1 point) Questions 3: The budget deficit has been rising in many oil- producing countries caused by the lower oil prices. Assuming that these countries have an independent monetary policy, how can rising Governments' budget deficit in those countries influence the interest rates (Specify the direction of the interest rate in your answer). (1 point) Questions 4: Assume that Oman is planning to impose taxes on personal income (from 0% to 10%) for its residents, and you as a financial advisor have been asked how would it impact the interest rates. Assuming that Oman has an independent monetary policy, how can the introduction of personal taxes affect the interest rate in Oman? (1 point)
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