Author Question: Suppose a U.S. citizen purchases a one-year Norwegian bond that yields 10 percent interest. Between ... (Read 106 times)

gonzo233 · **on:** Jun 30, 2018

Suppose a U.S. citizen purchases a one-year Norwegian bond that yields 10 percent interest. Between the purchase date and the maturity date, the exchange rate changes from to How much was initially invested in the bond if the dollar value of the proceeds at maturity is 3,500? (roundoff up to the nearest whole number)
a. 2,916
b. 3,150
c. 3,500
d. 3,850
e. 4,200

Question 2

If the United States purchases oil from Kuwait, what is the effect in the exchange market?
a. It will increase the supply of U.S. dollars.
b. It will decrease the supply of U.S. dollars.
c. It will increase the demand for U.S. dollars.
d. It will decrease the demand for U.S. dollars.