Question

In: Finance

QUESTION 1 Suppose the euro was worth $1.25 in 2016. In 2017, a dollar was worth...

QUESTION 1

Suppose the euro was worth $1.25 in 2016. In 2017, a dollar was worth .90 pounds. Find the percentage appreciation/depreciation of the dollar from the British point of view.

A) -.1250 B) .1111 C) -.1111 D) .1250

QUESTION 2

2/17	2/18	2/19
£.8/$	$1.30/£	£.9/$
¥125/$	¥122/$	$.007/¥
€1.1/$	€/$.85	$.95/€

What is the percentage appreciation/depreciation of the Euro from the US point of view from 2/17 to 2/18? Round intermediate steps and your final answer to four decimals. Express your answer in decimal format (ex. .XXXX)

QUESTION 3

You observed the following quotes between Canadian dollars (C$), euros (€) and Swiss francs (CHF) on 3/1/XX:

C$1=€.90, C$.70/CHF

On 3/2/XX, quotes for each currency were as follows: C$1.15=€1, C$.75/CHF

You converted 600,000 Swiss francs into euros on 3/1. On 3/2 you converted your euros back to Swiss francs. How many francs would you have on 3/2?

A) 715,555.56

B) 665,357.14

C) 246,521.74

D) 579,587.4

QUESTION 4

In order to calculate a cross exchange rate between currencies X and Y, both X and Y must have a known exchange rate with a third currency.

True OR False

SHOW WORK, PLEASE. THANKS

Expert Solution

QUESTION 1
Suppose the euro was worth $1.25 in 2016. In 2017, a dollar was worth .90 pounds. Find the percentage appreciation/depreciation of the dollar from the British point of view.
A) -.1250 B) .1111 C) -.1111 D) .1250

In year 2016 = $1.25/€1
In year 2017 = $1/.90 = $1.11/€1
Dollar is appreciated from year 2016 to 2017
% Appreciation = ($1.11 - $1.25)/$1.25	-0.1111

QUESTION 2
What is the percentage appreciation/depreciation of the Euro from the US point of view from 2/17 to 2/18? Round intermediate steps and your final answer to four decimals. Express your answer in decimal format (ex. .XXXX)
In year 2017 =€1.1/$1
In year 2018 = €/$.85 = €1.765/$1
Euro is depreciated from year 2017 to 2018
% Depreciation = ($1.765 - $1.1)/$1.1	0.0695

QUESTION 4
In order to calculate a cross exchange rate between currencies X and Y, both X and Y must have a known exchange rate with a third currency.	TRUE

jeff jeffy answered 2 years ago

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