for the case of US, EURO, Remnimbi, Sterling or Japan, explain the major factors behind exchange...
explain the factors that determine the Euro/US exchange rate in the Foreign exchange market in recent years?
The exchange rate between the US dollar and the Euro is $1 = .9 Euro. If Italian shoes costs $100 in the U.S. and 92 Euros in Italy, does purchasing power parity hold in this case? If the exchange rate instead were $1 = .89 Euro, is the rate closer to that where parity holds or further away?
Problem 2.(35 points) Suppose that the current Japan/US exchange rate is Eyys - 120, while the current Japan/Euro exchange rate is Eyje = 130 and the Euro/US exchange rate is Ee/s-0.7. Suppose your bank can exchange dollars, yen and euros freely and without extra charge at the current exchange rate. Now consider the following scheme. 1. Suppose you take out $100 from your savings account and convert them into yen at the current exchange rate. How many yen would you...
Determination of exchange rates depends on factors causing fluctuations. Explain why and its effect on US dollar Distinguish between DER & IER.
The exchange rate between Japan and the US is JPN1.385/$. If there is increased political uncertainty in Japan, how does this affect the exchange rate between Japan and the US?
Question 48 The exchange rate of US Dollar to Euro yesterday, May 8 was $1/€0.89222. The exchange rate two months ago on March 8 was $1/€0.89301. Which one is true about the change over the two moths? a) Dollar is appreciated b) Both currencies are appreciated c) Euro is appreciated d) Dollar is depreciated e) c and d Question 46 Why does a ‘black market’ of foreign exchange occur in many countries, especially in the low-income developing countries? a) Due...
The exchange rate (units per US dollar) for the Euro is 1.086 and for the Canadian dollar is 1.564. What is the Canadian dollar/Euro exchange rate?
You are a US investor. The US interest rate is 5% while the Euro interest rate is 4.2%. With a current spot exchange rate E$/€=1.25 and an expected exchange rate of E e $/€=1.08. a. Is dollar expected to appreciate or depreciate (against euro)? Explain. b. Does UIP hold true here? Explain. c. Which type of deposit is more attractive? Dollar deposit, euro deposit, or no difference? Explain. please show all work
The present exchange rate between US dollars and Euros is 1.34 $/Euro. The price of a domestic 180-day Treasury bill is $99.50 per $100 face value. The price of the analogous Euro instrument is 98.50 Euros per 100 Euro face value. a. What is the theoretical 180-day forward exchange rate? b.Suppose the 180-day forward exchange rate available in the marketplace is 1.31 $/Euro. This is less than the theoretical forward exchange rate, so an arbitrage is possible. Describe a risk-free...
Suppose we have the following exchange rate quotes: in US$ per US$ Euro area (€) 1.3455 .7432 Mexico (Ps) .0781 12.8113 a. If you have $225, you can get euros. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Use the €/$ exchange rate in your calculation.) b. One euro is worth $ . (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) c. If you...