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Title: If the exchange rate changes from 20 cents per franc to 18 cents per franc, the U.S. dollar has Post by: Beezus on Feb 27, 2018 If the exchange rate changes from 20 cents per franc to 18 cents per franc, the U.S. dollar has
a. appreciated, since its value has increased b. appreciated, since its value has declined c. depreciated, making French goods more expensive in U.S. dollars d. depreciated, since its value has declined e. depreciated, since its value has increased QUESTION 2 If the discount rate is 5 percent, the present value of annual 100,000 payments in perpetuity (i.e., continued indefinitely into the future) is a. 2,000,000 b. 1,246,296 c. 1,000,000 d. 976,463 e. infinite QUESTION 3 If on Monday you can buy 13 Mexican pesos per U.S. dollar and on Wednesday you can buy 15 Mexican pesos per U.S. dollar, a. both the U.S. dollar and the Mexican peso have appreciated b. both the U.S. dollar and the Mexican peso have depreciated c. the U.S. dollar has appreciated and the Mexican peso has depreciated d. the U.S. dollar has depreciated and the Mexican peso has appreciated e. the Mexican peso has appreciated and the U.S. dollar has remained constant QUESTION 4 A firm is considering the purchase of a piece of equipment that will add 200 per year to the firm's revenue forever. If the interest rate is 10 percent, the firm will purchase the equipment so long as it costs less than a. 1,000 b. 2,000 c. 4,000 d. 6,000 e. 8,000 QUESTION 5 From the U.S. perspective, a drop in the price of foreign exchange means that a. fewer U.S. dollars are needed to purchase foreign currency b. more U.S. dollars are needed to purchase foreign currency c. worldwide, imports will become more expensive d. worldwide, exports will become cheaper e. transaction costs on international markets will decrease QUESTION 6 The present value of an annuity that pays 100 each year indefinitely (i.e., a perpetuity) is 2,000 if the interest rate is 5 percent. a. True b. False QUESTION 7 A drop in dollar price of British pounds means that a. fewer dollars are needed to buy British pounds b. more dollars are needed to buy British pounds c. the mark has appreciated d. the dollar has depreciated e. British goods are now more expensive to Americans Title: If the exchange rate changes from 20 cents per franc to 18 cents per franc, the U.S. dollar has Post by: Fleur-de-lis on Feb 27, 2018 Content hidden
Title: If the exchange rate changes from 20 cents per franc to 18 cents per franc, the U.S. dollar has Post by: Beezus on Feb 27, 2018 tremendous help
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