Question

10) Suppose you read the following: "U.S. multinational companies tend to suffer when the strengthens, because their foreign profits are worth fewer dollars when they bring home carnings." This is an example of the effect(s) a change in currency value can have on a company's cash flows. A) halo B) conversion and competitive C) conversion D) competitive 11) Suppose that the current exchange rate is £1.00 - $2.00. The direct quote, from the US perspective A) $2.00 - £1.00. B) £0.50 - $1.00. C) £1.00 - $0.50. D) none of the options

Answer 1

The answer is C)Conversion

This is conversion effect which arises from exchanging one currency into another

11)Direct Quote is expressed in terms of foreign currency

Hence, the answer is

A)$2 = Pound 1