Explain how each of the following will affect the relative values of the dollar and the French franc: 2.Inflation higher in France than in the United States.
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International Finance (chapter 21) posting 2dn time for better explanation thanks
Question Explain how each of the following will affect the relative values of the dollar and the French franc:
2.Inflation higher in France than in the United States.
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- Explain how each of the following will affect the relative values of the dollar and the French franc: a. Income growth higher in the United States than in France. b. Inflation higher in France than in the United States. c. A real interest rate higher in the United States than in France.Question 5 If an American went back to the same Paris hotel room she enjoyed five years ago and noticed it was still priced at 100 Euros as it used to be ... and she was very very happy...why? a. the Euro had appreciated b. she's confused, she should not have been pleased at all. c. the dollar may have appreciated in value. d. the dollar had depreciatedA currency depreciates if it buys less of a foreign currency than it did before. The US dollar depreciated against what currency(a) from month 1 to month 2? Explain using the chart
- In 2021, Australia’s GDP growth rate was 3.4% which is much higher than its 10-year average. In 2021, the US GDP growth rate was 5.7%, the fastest full-year clip since 1984. Assuming there are only two countries in the world, Australia and US, and other things are fixed, please use appropriate diagrams or theories to predict the movements of the nominal value of the Australian dollar against the US dollar.of An appreciation of the dollar is usually a sign that Select one: A Canadian interest rates have increased. OB. real national income in Canada is increasing. OC. the Bank of Canada is pursuing an expansionary monetary policy. OD. D. Canadian bond prices have increased.In 1971 a British company, Beecham Group, received a Swiss franc loan of CHF 100 million. By the time the loan was repaid in 1976, the British pound had depreciated significantly against the Swiss franc. Which of the following statements is correct? A. The cost in British pounds of making the repayment did not change. B. The financial manager of Beecham Group would not be concerned about the change in the value of the pound. C. The change in the value of the British pound increased the profitability of the Beecham Group. D. The cost in British pounds of making the repayment increased significantly.
- Multinationals generally have production plants in a number of countries. Consequently, they can move production from expensive locations to cheaper ones in response to various economic developments– a phenomenon called outsourcing when a domestically based firm moves part of its production abroad. If the dollar depreciates, what would you expect to happen to outsourcing by American companies? Explain and provide an example.Suppose that prices in Brazil are rising faster than US prices, and the US is a very important trading partner of Brazil. (Brazil’s currency is called the real.) Suppose the dollar/real rate is floating. Required : What does relative purchasing power parity (RPPP) say should happen to the value of the real relative to the US dollar? Explain.Recently U.S. dollar has been very strong relative to the major currencies. Do you like it? How could a strong dollar affect U.S. firms? please help with discussion post
- For many years, the Chinese currency has been pegged to the U.S. dollar. Critics argue that this policy has resulted in an unfair advantage for Chinese manufacturers exporting product to the U.S., and has contributed to ballooning U.S. trade deficits. Pressure to revalue, including threats of trade sanctions against China, has led the Chinese government to adopt a slightly more flexible policy which pegs the Yuan to a basket of currencies rather than the dollar alone. Some in the U.S. continue to argue that this is not sufficient, and continue to exert pressure toward a policy of further revaluation. Chinese leaders feel that increasing the value of the yuan relative to the dollar would contribute to economic and political instability in China. Details: Pressures for Change China fixed the value of its currency in 1994 to the US currency Due to arguments that the yuan was undervalued and that the Chinese government needed to free the currency, the U.S. administration announced…If the dollar depreciates against the Indian rupee Indian imports to the U.S. become less expensive. U.S. exports to India become less expensive. U.S. exports to India become more expensive. The value of Indian imports to the United States does not change.The British pound (GBP) falls in value relative to the dollar. Consider a U.S. bank with a European trading subsidiary in London (which earns profit in pounds). This devaluation...benefits/harm the U.S. bank, since each pound it earns in profits through its European subsidiary is now worth ....more/less dollars.