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Suppose that a U.S. firm repatriates a dividend of 175,000,000 euros each quarter from its Italian subsidiary. Suppose that the dollar appreciates against the euro. The dollar value of the next dividend to the U.S. parent company is:

options:

higher than last quarter’s

lower than last quarter’s

unaffected because the exchange rate has no effect on the U.S. parent company

unaffected because the value of the dividend is recorded in yen

both c. and d.

Operation Management, Management Studies

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