231.89 264.3540 498 527.88 989 1038.45

International Financial Management
14th Edition
ISBN:9780357130698
Author:Madura
Publisher:Madura
ChapterP3: Part 3: Exchange Rate Risk Management
Section: Chapter Questions
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1. – Using the following information, determine each one of the theoretical Exchange Rates
(E.R.) for December of year 02 according to the Relative PPP Theory.
MARKET
MARKET
E.R.
E.R.
COUNTRY
CURRENCY
СРI
CPI
Dec-01
Dec-02
Dec-01
Dec-02
Mexico
МХР
231.89
264.3546
19.56
20.15
Turkey
TRY (Lira)
498
527.88
5.9419
6.07673
Australia
AUD
989
1038.45
1.7759
1.81183
Japan
JPY
678
745.8
105.866
113.978
United
Kingdom
GBP
905.26
986.7334
0.5991
0.617849
South Korea
KRW (Won)
795.4
874.94
1,658.62
1,793.37
Canada
CAD
523.12
554.5072
1.3736
1.4942
U.S.A.
USD
1.5
1.56
Transcribed Image Text:1. – Using the following information, determine each one of the theoretical Exchange Rates (E.R.) for December of year 02 according to the Relative PPP Theory. MARKET MARKET E.R. E.R. COUNTRY CURRENCY СРI CPI Dec-01 Dec-02 Dec-01 Dec-02 Mexico МХР 231.89 264.3546 19.56 20.15 Turkey TRY (Lira) 498 527.88 5.9419 6.07673 Australia AUD 989 1038.45 1.7759 1.81183 Japan JPY 678 745.8 105.866 113.978 United Kingdom GBP 905.26 986.7334 0.5991 0.617849 South Korea KRW (Won) 795.4 874.94 1,658.62 1,793.37 Canada CAD 523.12 554.5072 1.3736 1.4942 U.S.A. USD 1.5 1.56
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