Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) One year ago, the American investor bought 1000 shares of London Bridges at price of= £22 (or 22 UK pounds) per share when exchange rate was= $1.5/1£ (or $1.50 dollars = 1 pound). Investor also invested 800,000 Japanese Yen in money market fund in Japan last year when exchange rate was 85 Yen = $ 1 US.

(a) B y using current exchange rates, what is today’s value of investor’s portfolio in U.S. dollars if UK investment decreased 5% (in local currency) and Japan investment increased 1% (in local currency)?

(b) Determine the overall rate of return on portfolio over last year?

2) American firm is estimating the investment in Mexico. Project will need purchasing equipment from variety of sources and shipping it to Mexico. Projected cost of buying equipment and shipping it is $3.7 million. Once project begins operations, it is expected to last for five years (suppose straight line depreciation). Expected sales are $1,700,000 each year in U.S. and costs of project are projected to be 6 million pesos each year for the five years. If taxes are 35%, the suitable discount rate is 9% and you use present exchange rate for pesos:

(a) Compute NPV in U.S. dollars.

(b) Compute NPV in Mexican pesos.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M914660

Have any Question? 


Related Questions in Basic Finance

1 using the internet the library or another information

1. Using the Internet, the library, or another information source, print out three different articles that describe the same disaster event. Compare the three articles to determine which provides the most useful informat ...

1 affordable payments what should you consider when

1. Affordable Payments. What should you consider when determining an affordable down payment and monthly mortgage payments? 2. Selection Criteria . List the criteria you should use when selecting a home. 3. Selection Cri ...

What is a pro forma financial statement what is economic

What is a pro forma financial statement? What is economic value added and why do financial managers care about this? Explain what is meant by a balanced scorecard ? If companies in an industry have significant profits an ...

How does the value of an unlevered firm change if it takes

How does the value of an unlevered firm change if it takes on debt in the presence of corporate taxes? Repeat the analysis for ANF from the previous problem, after relaxing only the "no corporate tax" assumption of perfe ...

Angelo purchased a 7 annual coupon bond one year ago for

Angelo purchased a 7% annual coupon bond one year ago for $987. At the time of purchase, the bond had six years to maturity. Over the past year inflation has been 3.2%. The market required return on this bond today is 8% ...

One of the behavioral research case studies in this chapter

One of the Behavioral Research Case Studies in this chapter involved Agocha and Cooper's (1999) study of partner characteristics and intentions to practice safe sex. Below are the Pearson correlations between the lik ...

1 researchers who use group designs replicate their

1. Researchers who use group designs replicate their findings by repeating the same (or a similar) experiment on other samples of participants. How do single-case researchers replicate their findings? 2. What is the rati ...

The text discusses the trade-off between internal and

The text discusses the trade-off between internal and external validity, known as the experimenters dilemma. Speculate on things a researcher can do to increase internal and external validity simultaneously, thereby desi ...

Read one practical article of how psychology affects

Read one practical article of how psychology affects spending behavior. Easily retrieve possible articles by doing an online search using the terms "psychology" and "spending." Summarize the main points of the article.

1 why are planning and forecasting a global work force so

1. Why are planning and forecasting a global work force so difficult? 2. Why are so many countries bothered by their "brain drain"? 3. If you are given the opportunity in your next job to go on an extended foreign assign ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen