An increase in capital inflows in South Africa will result in a (n) _________foreign currency and a (n) _______the South African Rand in the foreign exchange market. (4 marks) A Increase in the demand for; increase in the supply of B Increase in the supply of; increase in the demand for C Shortage of; surplus of D Surplus of; shortage of

Q: A standard speculation consists in borrowing in the home country, investing abroad and selling the…

A: Investment refers to the process of paying one’s own savings to firms or organizations for their…

Q: If Canadian purchases of foreign real estate are $100 million, Canadian purchases of foreign-…

A: Capital account is financial in nature which records the transactions associated with change in…

Q: The UK company has to make payment to Omani Company in OMR after 60 days for the purchase of crude…

A: A forward contract may be a customizable derivative contract between two parties to shop for or sell…

Q: Which of the following are not a part of capital Account of Balance of Payment a. Foreign Loans b.…

A: As the name implies, a country's balance of payments (BOP) shows how much money has flowed from one…

Q: At the beginning of year 1 the Terranian central bank conducted tek100 million of dollar…

A: The way a country manages its currency in the foreign exchange market is referred to as an exchange…

Q: Investment Capital consumption allowance (depreciation) Exports Imports Government purchases…

A: National Income : the total income from current output of a nation, which includes interest, rental…

Q: Question 2: You want to invest your $6000 in a financial asset. In 2020, one-year US bonds pay an…

A: Answers   a) Let the investment is made in US bonds Expected return in US bonds=3% Now assume that…

Q: In 30 days Radio Shack must pay yen to a Japanese supplier for a shipment of radios arriving then.…

A: Given information:- Imported radio cost     = ¥ 9,000 per radio Selling price of radio    = $ 100…

Q: foreign interest rate is 5%, the risk premium on domestic assets, ρ, is -7%, and the expected rate…

A: The interest rate Parity condition holds When we express the domestic interest rate into foreigner…

Q: If prices grew at a compound growth rate of 4% per annum in the United States and 0.07% per annum in…

A: Given; Price growth rate in U.S.= 4% per annum Price growth rate in Japan= 0.07% Inflation rate…

Q: Item Amount ($) 1,721.6 1,096.3 Government purchase of goods and services Exports Receipts of factor…

A: * SOLUTION :-  * The GDP is  = Consumption + investment + government purchases  + (exports - imports…

Q: Assume that the dollar price level is 15,0 level is 10,000GBP/Consumption bundle, and the exchange…

A: Purchasing power is the value of a currency expressed in terms of the number of goods or services…

Q: 2. An appreciation of the dollar would result in: A) foreign travel for U.S. residents to be more…

A: Ans 2. Currency appreciation refers to the increase in value of one currency relative to another in…

Q: When you are selling Omani Rial for getting US Dollar it is related to? a. Interest rate b.…

A: Given:  Selling of Omani Rial to get US dollar.

Q: Investors may view the euro area with suspicion because one of its member's public debt increases…

A: The outflow or the inflow of a currency depends upon its relative strength in the international…

Q: 1-Explain two benefits and two costs of foreign direct investment to a host country 2- Discuss two…

A: Foreign direct investment A company buys a stake in a company in another country through foreign…

Q: Should DAMC consider other foreign investment strategies, like strategic alliance, joint venture…

A: Even though the pandemic represents a "detour" from the globalization trend, DAMC should investigate…

Q: 3-Spot rate OMR 0.500 = 1 CNY (Chinese Yuan Renminbi). It is expected that CNY may depreciate by 5%…

A: Initially, 1 CNY = OMR 0.5 When CNY depreciates by 5%, 1 CNY = OMR 0.5 x (100 - 5)% = OMR 0.5 x 95%…

Q: A car costs $20,000 in the United States and 2.500,000 yen in Japan. The exchange rate is $1 103…

A: Purchasing power parity (PPP) is a popular metric used by macroeconomic analysts that compares…

Q: Given that: £1/$1.6365 1.6385 0.005 - 0.0047 Spet raie 3 month forward Compute the cost of cover to…

A: * SOLUTION  :-    (d)   Given that ,  Spot rate  :-  1.6365 to 1.6385 Month forward :- 0.005 to…

Q: The purchase or sale of foreign exchange by the central bank of the country to influence the…

A: The central bank has the authority to manage or influence foreign Exchange rate by selling and…

Q: The equation S = I + NCO describes the savings market for an entire national economy engaged in…

A: S=I+NCO determines savings includes investment plus net capital of the economy and savings are part…

Q: 24. The inflation rate in the U.S. is 3%, while the inflation rate in Japan is 10%. The current…

A: Inflation is the rate of increase in prices over a given period of time. Here, we calculate the…

Q: True/False  A pro-savings policy by the US would likely reduce the US trade deficit.

A: Trade deficit: It refers to the situation in which the country import exceeds the country’s export.…

Q: PQ 22b What is a situation the purchasing power exchange rate would be used?

A: Exchange rate is defined as the value of one nation's currency compared to the currency of some…

Q: All else equal, depreciation of the Mexican peso relative to the U.S. dollar would make a trip by: a…

A: When peso depreciates, a Mexican peso will buy less units of US dollar, and a US dollar will buy…

Q: Assume the New Taiwan dollar (NTS) value is tied to the Canadian dollar (CAD) and will remain tied…

A: When a country’s currency depreciates, there is a rise in exports and a fall in imports. When a…

Q: 1. A depreciation of the dollar on the foreign exchange market would result in: A) a decrease in the…

A: Hi, thank you for the question. As per our Honor code, we are allowed to attempt only the first…

Q: Other factors being constant, a lower than expected inflation rate in the U.S will result in dollar…

A: If inflation rate is lower than expected, then it makes U.S goods more competitive both in the…

Q: Suppose DeGraw Corporation, a U.S. exporter, sold a solar heating station to a Japanese customer at…

A: The correct answer is given in the second step.

Q: Pro forma income statement, in won (millions)   sales (1,000,000 @ 5,000 won/set).............…

A: Initial Won Values = 484/$ After devalues won Value = 580/$

Q: QUESTION 13A nominal appreciation of the Mexican peso against the Australian dollar indicates that:…

A: The price of one country's domestic currency in terms of another country's domestic currency is…

Q: iven the following transactions between the domestic and foreign countries: I. Domestic business…

A: The balance of payments is divided into current account and capital account.

Q: If prices grew at a compound growth rate of 5% per annum in the United States and 0.08% per annum in…

A: Given: The growth rate of US=5% per annum The growth rate of Japan=0.08% per annum Rate=JPY 109/USD…

Q: Suppose that a U.S. company wishes to purchase goods from a German producer. The U.S. firm agrees to…

A: Given 3 month exchange rate EUR/USD = 0.95 dollars Total payment = 1 million Euros Payment made…

Q: If the dollar interest rate is 10 percent, the euro interest rate is 6 percent, then A) an investor…

A: Given:- Dollar interest rate=10% Euro interest rate=6% An investor is a profit maximizer, who wants…

Q: A certain commodity cost 0.5 pound sterling in the United Kingdom. In U.S. denominated dollars, this…

A: The exchange rate refers to the price of one nation's currency in terms of another nation's currency…

Q: Analyze the impact of appreciation and depreciation of US Dollar upon net exports of USA?

A: Exchange rate: - the exchange rate is the rate at which the currency of one country can be exchanged…

Q: Jetta production cost in 2002 and 2003 was 8,500 Euro per Jetta. Jettas were sold in US at $12,000…

A: Here we calculate the profit or loss from sale by calculating the effect of exchange rate and choose…