This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Suppose a U.S. firm buys a one-year U.K. bond for 6,000 British pounds when 1 British pound is worth ... (Read 331 times)

bcretired

  • Hero Member
  • *****
  • Posts: 525
on: Jun 30, 2018
Suppose a U.S. firm buys a one-year U.K. bond for 6,000 British pounds when 1 British pound is worth 1.50 on the foreign exchange market. What is the firm's approximate rate of return on the bond if the interest rate on the bond is 15 percent and the exchange rate is 1 British pound is worth 1.93 at maturity?
 a. 11 percent
  b. 15 percent
  c. 25 percent
  d. 33 percent
  e. 48 percent

Question 2

U.S. imports are considered:
 a. a credit or plus item in the U.S. balance of payments.
  b. a credit or minus item in the U.S. balance of payments.
  c. a debit or plus item in the U.S. balance of payments.
  d. a debit or minus item in the U.S. balance of payments.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

yuyiding

  • Sr. Member
  • ****
  • Posts: 357
Reply #1 on: Jun 30, 2018
Answer to Question 1

e

Answer to Question 2

d


bcretired

  • Hero Member
  • *****
  • Posts: 525
Reply #2 on: Jun 30, 2018
Thank you :)


yuyiding

  • Sr. Member
  • ****
  • Posts: 357
Reply #3 on: Jun 30, 2018
Happy to help you


« previous next »
 

Did you know?

Anesthesia awareness is a potentially disturbing adverse effect wherein patients who have been paralyzed with muscle relaxants may awaken. They may be aware of their surroundings but unable to communicate or move. Neurologic monitoring equipment that helps to more closely check the patient's anesthesia stages is now available to avoid the occurrence of anesthesia awareness.

Did you know?

You should not take more than 1,000 mg of vitamin E per day. Doses above this amount increase the risk of bleeding problems that can lead to a stroke.

Did you know?

In the United States, congenital cytomegalovirus causes one child to become disabled almost every hour. CMV is the leading preventable viral cause of development disability in newborns. These disabilities include hearing or vision loss, and cerebral palsy.

Did you know?

There used to be a metric calendar, as well as metric clocks. The metric calendar, or "French Republican Calendar" divided the year into 12 months, but each month was divided into three 10-day weeks. Each day had 10 decimal hours. Each hour had 100 decimal minutes. Due to lack of popularity, the metric clocks and calendars were ended in 1795, three years after they had been first marketed.

Did you know?

In most cases, kidneys can recover from almost complete loss of function, such as in acute kidney (renal) failure.

Directionality of the hydrogen bond Directionality of the hydrogen bond
This engraving of the Boston Massacre (1770) became the most reprinted depiction of the event, and p This engraving of the Boston Massacre (1770) became the most reprinted depiction of the event, and p
A noose hanging from a “Liberty Tree” reveals this artist’s bias: The “tar-and-feathering” of a Brit A noose hanging from a “Liberty Tree” reveals this artist’s bias: The “tar-and-feathering” of a Brit
The Kingsley plantation, on Fort George Island in Jacksonville, Florida. Zephaniah Kingsley, the own The Kingsley plantation, on Fort George Island in Jacksonville, Florida. Zephaniah Kingsley, the own
Peptide bond as resonance hybrid of two forms Peptide bond as resonance hybrid of two forms
Foods for Baby’s First Year Foods for Baby’s First Year
Video: Status Epilepticus

For a complete list of videos, visit our video library