MGF402 Homework 3 Due date: Thursday October 31st 1. Calculate EAR and APR for the following questions. a. You have an APR of 7.5% with continuous compounding. What is the EAR? b. You have an EAR of 9%. What is the equivalent APR with continuous compounding? c. The buyer of a new home is quoted a mortgage rate of 0.5% per month. What is the APR on the loan? d. A loan for a new car costs the borrower 0.8% per month. What is the EAR? Answer: a. 1 + EAR = eAPR => EAR = eAPR - 1 =
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International Business Theory and Practice (5Q5Z0047) Foreign Direct Investment (Samsung) Assignment deadline: Wednesday 23th January 2013 Foreign Direct Investment Abstract The paper shows how Samsung developed their system for FDI using innovative products‚ people and substantial investment in R&D‚ the early policy of export which lead to purchasing of subsidiaries‚ including the global managerial experience has lead them to become a global market leader‚ if Samsung continue in
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1. Why is GM worried about the yen? GM’s concern about fluctuations in the Yen is due not only to the impact on GM’s costs‚ but the fact that Japanese competitors face reduced costs when the Yen is depreciating. Also‚ with increasing profit margins‚ end-price to consumer can be lowered and lead to gain in market share for Japanese competitors. Research had shown that a 10 Yen appreciation to the dollar reduces operating profit by $4 billion 2. How important is GM’s competitive exposure?
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Questions from Chapter 7 Q-2 Answer : Yes because one could purchase new zealand dollars at yardley Bank for $.40 and sell them to Beal Bank for $.401. With $1 million available‚ 2.5 million New Zealand dollars could be purchased at Yardley Bank. These New Zealand dollars could then be sold to Beal Bank for $1‚002‚500‚ thereby gener ating a profit of $2‚500. The large demand for New Zealand dollars at Yardley Bank will force this bank’s ask price on New Zealand dollar to increase
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Ch: 4-Exchange rate movement in recent months AUD per USD BDT per USD Month Rate % change Rate % change Sep-13 0.9303 76.3765 Oct-13 0.9519 0.023218317 76.2753 -0.00132501 Nov-13 0.9324 -0.020485345 76.4057 0.001709597 source: foreign exchange rate‚(dec 2‚ 2013) The above currencies are showed in the indirect quotations reflects the average rates of exchange rate. The Bangladeshi taka and Australian dollar are here showed against the US dollar to measure the currency
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Chapter 2 Self Test (Answers are below) 1. Which of the following statements about accruals and cash flows is false? A. Company value can be determined by using accrual accounting numbers. B. Accrual accounting numbers are subject to accounting distortions. C. Cash flows are more reliable than accruals. D. Cash flows cannot be manipulated. 2. Financial accounting data has some inherent limitations. Which of the following are limitations? I. Not all economic events are easily quantifiable
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International Finance Paper Many companies today have decided to take their business into the international marketplace. Costco is a company that has successfully entered the international marketplace with warehouses in several countries around the world. When Costco opened warehouses international it had to take into consideration Global banking and the risk it would have with the different exchange rates. Another issue that also had to be taken into consideration would be the different regulations
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Part II Core Theory: Classic International Trade Theories Table of Contents Part II Core Theory: Classic International Trade Theories.........................2 1. Mercantilism ...........................................................................................2 The Classical World of David Ricardo and Comparative (Chapter 3) .......3 Advantage ...................................................................................................3 Absolute Advantage and Comparative Advantage
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INTERNATIONAL FINANCE CORPORATION STRUCTURE 6.0 objectives 6.1 Introduction 6.2 Ownership and management 6.3 IFC’s Objectives 6.4 Funds of IFC 6.5 IFC’S Strategic Focus 6.6 Financial Products & Advisory services of IFC 6.6.1 Financial Services 6.6.2 Advisory Services 6.7 Project Cycle 6.8 Summary 6.9 Practice Questions 6.10 Suggested Readings 6.0 OBJECTIVES After reading this chapter the students should be able to: 1. know what is IFC. 2. understand its
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FINC/ECON 3240 - International Finance Homework Solution Chapter 1 2. Comparative Advantage. a. Explain how the theory of comparative advantage relates to the need for international business. ANSWER: The theory of comparative advantage implies that countries should specialize in production‚ thereby relying on other countries for some products. Consequently‚ there is a need for international business. b. Explain how the product cycle theory relates to the growth of an
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