shareholders? A) managers B) employees C) attorneys D) suppliers 2) The cash manager at AmFlex Company needs to buy 1‚000‚000 British pounds to pay a British supplier. A currency broker quotes him a bid-ask rate of ₤.4865-.5116/US$. What will be the dollar cost of the 1‚000‚000 pounds? A) $486‚618 B) $1‚954‚652 C) $511‚587 D) $2‚055‚499 3) In determining why a firm becomes multinational there are many reasons. One reason is that the firm is a market seeker. Which of the following is NOT a reason why market
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Lufthansa In January 1985‚ a German company that uses Deutschmarks made a large purchase from a U.S. company that uses U.S. dollars‚ and needed to evaluate the best hedging alternatives to secure the least possible cost. The Chairman of Lufthansa‚ Herr Heinz Ruhnau‚ purchased twenty 737 jets from Boeing. The total purchase price was $500‚000‚000‚ which was payable in U.S. dollars on delivery of the aircrafts in one year. Chairman Ruhnau chose a partial cover by hedging 50% of the exposure with forward
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an online banking. When people transfer bitcoins‚ an electronic signatures added. After few minutes‚ the transaction is verified by miner and permanently stored in the network. Several currency exchanges exist what you can trade your bitcoins for dollars‚ euros and more. 2) Controversy about Bitcoin - Can Bitcoin substitute real currencies? Bitcoin is one of the most controversial issues in recent international business. Can we take bitcoin as a real currency for trading goods? The answer
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. If the inflation rate in the United States is greater than the inflation rate in Sweden‚ other things held constant‚ the Swedish currency will a. Appreciate against the U.S. dollar. b. Depreciate against the U.S. dollar. c. Remain unchanged against the U.S. dollar. d. Appreciate against other major currencies. e. Appreciate against the dollar and other major currencies. EMU Answer: c Diff: E . What is the common currency of the EMU? a. U.S. dollar. b. British pound. c. Euro.
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manufacture more products in the United States and Europe and to also buy more from suppliers in other countries in Asia? It is important for Sony to manufacture more products in the United States and Europe as a way to sell more and improve profit margins. The most straightforward way to manage exchange rate fluctuations and minimize the risk from these fluctuations is to shift production to those countries whose exchange rates are less violate and to the United States and Europe. This will allow
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Japanese yen and the U.S. dollar is 120 yen per dollar. If the dollar is expected to depreciate by 10% relative o the yen‚ what is the new expected exchange rate? Rate is 120 yen – 1 dollar If dollar depreciates 10% then the new exchange rate will be 108 yen – 1 dollar Web Exercise 1: a) What is the percentage change in the euro-dollar exchange rate been between the euro’s introduction and now? In December 1999‚ the exchange rate was approximately .85 dollars per euro. As of today‚ the
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| Assignment Cover Sheet | Course Title: | | Section: | | Program: | | Assignment No. | | Student’s Complete Name: | | Student’s Complete ID: | | Date Submitted: | | Case 3.1 Foreign Exchange Trading at Baldwin Enterprises 1. Spread Sheet Model CURRENCY | AMOUNT | CONSTRAINTS | TRADING PLAN | USD | 4055972.522 | 4055973 | ≥ | 250000 | 111261.72087258300 | EUR | 8000000 | 7779200 | ≥ | 250000 | | GBP | 160328.3525 | 250000 | ≥ | 250000 | | HKD | 1951295
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fringe benefits‚ and stock options 7. Which of the following are the four geographic regions in which the company sells branded and private-label athletic footwear? a.The United States‚ Argentina‚ Great Britain‚ and Japan b.Europe-Africa‚ Latin America‚ Asia-Pacific‚ and North America c.Germany‚ Brazil‚ China‚ and the United States d.Latin America‚ Europe‚ China‚ and North America e.Japan/China‚ North America‚ the European Union‚ and the Middle East 8. Which of the following most accurately describes
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conglomerate. The subsidiary is Paginas Amarelas‚ which operates in three Latin countries such as Argentina‚ Brazil‚ and Chile. All cash flows have been converted to U.S. dollars‚ and present values computed for various discount rates. In order to the present value properly‚ he should determine the appropriate target rate of returns for dollar flows originating in Argentina‚ Brazil‚ and Chile. Q1. What is the valuation problem here? In what currency are the cash flows denominated? In what currency should
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Application-Level Requirements List 1. Value of Dollar 2. Value of comparing currency 3. Calculation of dollar value against subject currency value 4. Display results Input-Process-Output Chart Complete the following input-process-output chart for the application using a structured programming approach. Input | Process | Output | Dollar Value | get | Real number | Florien currency | get | Real number | Calculate difference | Divide | Decimal | Display
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Name: _________________________________________ Instructions: The exam is composed of ten problems. Make sure you have all pages in your exam. Including this cover page‚ you should have ten pages. Each problem has its own set of instructions. You may use abbreviations for labels to save time. Unclear responses will receive 0 points. Partial credit will be awarded. If you need additional space for your answer‚ use the back of the page. Problem 1 5 Points Mint Corporation
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annualized return. In the United States‚ 90-day securities have a 4% annualized return and 180-day securities have an annualized return of 4.5%. All securities are of equal risk‚ and Japanese securities are denominated in terms of the Japanese yen. Assuming that interest rate parity holds in all markets‚ which of the following statements is most CORRECT? a. The yen-dollar spot exchange rate equals the yen-dollar exchange rate in the 90-day forward market. b. The yen-dollar spot exchange rate
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exchange rate United States dollar. Why should be like that ...?‚ Because the true United States Dollar is currently an international currency. Even information says all the countries that exist in the world save its foreign exchange reserves in the form of dollars. So that’s not surprising almost everyone in the world want to accept dollars‚ meaning dollar is believed as a means of payment around the world. To note‚ although the universe is not only the United States that use the dollar‚ but only the
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have to make in 1993? Why was the decision important? 2. History of Japanese Yen. Describe the historical exchange rates between Japanese Yen and U.S. dollar over time. Focus on the big changes and what was the exchange rate in (and years before) July 1993. 3. To Hedge or Not? Do you think Tiffany should actively manage its yen-dollar exchange rate risk? Why or why not? Explain the benefits and costs of hedging. 4. What to Hedge? If Tiffany were to manage its exchange rate risk‚ then
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objectives should be to minimize foreign exchange rate risk and lower counterparty risks. We want to minimize these risks because Tiffany & Co. is selling goods that are denominated in US dollars‚ but sold for yen in the Japanese market. The objective of this program is to prevent the depreciation of the yen against the US dollar by hedging the currency. The expected Japanese sales of Tiffany & Co. should be actively managed by purchasing hedging contracts continuously on expiration of previous contract.
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will appear equally attractive to both companies. Q.2. Company X wishes to borrow U.S. dollars at a fixed rate of interest. Company Y wishes to borrow Japanese yen at a fixed rate of interest. The amounts required by the two companies are roughly the same at the current exchange rate. The companies have been quoted the following interest rates‚ which have been adjusted for the impact of taxes: Yen Dollars Company X 5.0% 9.6% Company Y 6.5% 10.0% Design a swap that will net a bank‚ acting
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Weak Dollar vs. Strong Dollar With the economy constantly changing‚ we are starting to see drastic changes in our dollar. A countries currency determines their strength in the market and their inflation rate. With a higher inflation rate‚ they are able to buy more and do more for a cheaper price. To help us better understand the difference between the weak dollar and the strong dollar‚ we will go in depth with both weak and strong dollars and its advantages and disadvantages‚ the currency monitor
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Question 2 a) A fall in the value of the Australian dollar (AUD) against the U.S. dollar (USD) benefit Billabong in two folds‚ strengthened price competitiveness and translation advantage. Firstly‚ the Americas segment accounts for about 50% of Billabong’s sales revenue in 2008 and 2009. (Appx.1) In case of depreciation of AUD against USD‚ the price of imported surfwear to the U.S. in terms of USD will decrease. The US importers demand more for Billabong’s products. The sales increases from the
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"Give me control of a nation’s money and I care not who makes it’s laws" -Mayer Amschel Bauer Rothschild. Rothschild makes a great point; the people of the United States have zero effect on their own currency. Not even the government has control over the production and distribution of its own currency. That control was given to banks and a private corporation named the Federal Reserve . These private institutions have created a cycle that enriches them and indebts the public. This vicious cycle
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U.S. Dollar Adopted by the United States on July 6‚ 1785‚[3] the U.S. dollar is the currency most used in international transactions.[4] Several countries use the U.S. dollar as their official cur- rency‚ and many others allow it to be used in a de facto capacity. In 1995‚ over US $380 billion were in circulation‚ two-thirds of which was outside the United States. By 2005‚ that figure had doubled to nearly $760 billion‚ with an estimated half to two-thirds being held overseas‚[5] representing an
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