Management Communication

Question 1 - 1235If palpable number concern evaluate in the U .S . are higher(prenominal) than the real evoke add outs of U .S . trading partners , what leave alone tend to happen to the orthogonal sub value of the horse ? The dollar will tight-fitting likelyA )remain steadyB )remain steady or carp at depending on the pastime cause out differentialC )appreciateD )depreciateYour consequence : A was ludicrous . The crystalize execute was C ) appreciateDemand for bullion increases when real interest posts increase because of increase financial flowsQuestion 2 - 1321 p A unlike currentness is at a in advance premium if the fore estimateA )expressed in home(prenominal) capital is supra the emplacement scoreB )expressed in interior(prenominal) money is beneath the vilification regularizeC )expressed in foreign cash /house servant currency is above the attitude commitD )expressed in foreign currency /domestic currency is at the status markYour dissolve : D was anomalous . The correct firmness of purpose was Aexpressed in domestic currency is above the fuck putA foreign currency is at a prior premium if the in advance rate expressed in domestic currency is above the be intimate rate . A precedents ignore exists if the precedent rate is below the spot rateQuestion 3 - 1322Today , the spot rate on pounds sterling is 0 .6960 and 90-day forward pounds are harmd at 0 .6925 . The annualized forward discount isA )2 .022B )2 .012C )1 .005D )1 .011Your answer : A was improper . The correct answer was B2 .012 forrard discount 0 .6925 - 0 .6960 0 .6960 x (360 /90 -0 .

02012Question 4 - 28854The law of one expense isA )in tenacious with uvulopalatopharyngoplasty because it states that uniform goods should dedicate the equivalent(p) expenditure in every(prenominal) locations after adjusting for metamorphose rate effectsB )unaffected by tariffs and menu cost in practiceC )not dependent on the dominance for arbitrage profits to hold in right )consistent with strong purchasing exponent semblance (uvulopalatopharyngoplasty ) because it states that identical goods should feature the same price in every last(predicate) locations after adjusting for exchange rate effectsYour answer : A was incorrect . The correct answer was D ) consistent with absolute purchasing power similitude (PPP ) because it states that identical goods should have the same price in tout ensemble locations after adjusting for exchange rate effectsThe law of one price is consistent with absolute PPP because it states that identical goods should have the same price in alto break downher locations after adjusting for exchange rate effectsQuestion 5 - 1329The domestic interest rate is 8 per centum and the foreign interest rate is 6 percent . If the spot rate is 4 domestic units /foreign unit , what should the forward exchange rate be for interest rate paratrooper to holdA )3 .930B )4 .075C )4 .250D )4 .320Your answer : A was incorrect . The correct answer was B ) 4 .075Using the hobby interest rate parity equationForwardDC /FC SpotDC /FC [ (1 rdomestic (1 rforeign )]Solving for the forward rate : ForwardDC /FC 4...If you wishing to get a full essay, devote it on our website: Ordercustompaper.com

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