Please answer. thanks 8. Longhorn Co. produces hospital equipment. All of its revenues are in US dollars, and half of its expenses require outflows in Philippine pesos to pay for Philippine materials. Most of Longhorn's competition is from US firms that have no international business at all. Why will Longhorn's profit be likely to decrease if the peso strengthens relative to the dollar?
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Please answer. thanks
8. Longhorn Co. produces hospital equipment. All of its revenues are in US dollars, and half of its expenses require outflows in Philippine pesos to pay for Philippine materials. Most of Longhorn's competition is from US firms that have no international business at all. Why will Longhorn's profit be likely to decrease if the peso strengthens relative to the dollar?Step by step
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- Assume the New Taiwan dollar (NT$) value is tied to the Canadian dollar (CAD) and willremain tied to the Canadian dollar.Last month, a NT$ = 0.35 Singapore dollars. Today, a NT$ = 0.25 Singapore dollars. Assumethat there is much trade in the computer industry among Singapore, Taiwan, and Canada and thatall products are viewed as substitutes for each other and are of about the same quality. Assumethat the firms invoice their products in their local currency and do not change their prices.a. Will the computer exports from the Canada to Taiwan increase, decrease, or remain the same?Briefly explain. (2%)b. Will the computer exports from Singapore to the Canada increase, decrease, or remain thesame? Briefly explain.A company manufactures a product in the United States and sells it in England. The unit cost of manufacturing is $52. The current exchange rate (dollars per pound) is 1.213. The demand function, which indicates how many units the company can sell in England as a function of price (in pounds) is of the power type, with constant 27556733 and exponent -2.5. A) Develop a model for the company's profit (in dollars) as a function of the price it charges (in pounds). Then use a data table to find the profit-maximizing price to the nearest pound. Assume that the price ranges from £45 to £100 in increments of £1. Round your answer for the maximum profit to the nearest dollar and your answer for the best price to the nearest pound. 1. Maximum profit: $______ 2. Best price: £ ______Billabong Fashion is based in Melbourne, Australia. Billabong Fashion has a subsidiary in Shanghai that generates RMB85 million in annual sales. Any earnings generated by the subsidiary are reinvested to support its operations. Belle Fashion is the close competitor of Billabong Fashion. Belle Fashion is a local Australian company located in Japan with annual export sale to Malaysia of about MYR 45 million. Based on the information provided, which firm is subject to a higher degree of translation exposure? Justify your answer with thorough explanation on both companies.
- Suppose that you are a finance manager at a U.S. based MNC. On January 1st, you anticipate you will need to purchase C170,000.00 (Canadian dollars) worth of supplies from a Canadian supplier in March using Canadian dollars (C$). The current spot rate $105,400.00 an dollar is $0.73. Suppose that on February 10th, you find out your MNC no longer needs the order of Canadian supplies and, th Therefore, you wish to close out your futures position. In order to close out your futures position in Canadian dollars, you would a futures contract specifying of March 10th. If the futures contracts for Canadian dollars are priced at $0.62, then your MNC would receive date from that contract in exchange for C$170,000.00. $147,560.00 $137,020.00 $126,480.00 ed Canadian dollars. with a settlement date on the settlementThe Japanese yen increases in value relative to the dollar, moving from 120 yento 110 yen to each U.S. dollar. From the perspective of a U.S. firm that produces in the UnitedStates and exports its product to sell in Japan:a. This is bad news.b. It doesn’t matter.c. This is good newsKS Inc. produces a product in the United Kingdom at a cost of £0.55 per unit which it then sells in France for €1.25 per unit. If in the currency markets, 1 U.S. dollar = £0.6373 and 1 U.S. dollar = €1.0279, how much profit is realized by KS Inc. on each unit of product sold? * $0.7857 $0.3531 $0.2571 $0.1095 When the supply for money increases and the demand for money reduces, there will be * A fall in the level of prices An increase in the rate of interest A fall in the level of demand A decrease in the rate of interest
- Suppose Mexico is a major export market for vour U.S.-based company and the Mexican peso appreciates drastically against the US. dollar. This means: (A) This means your company products can be priced out of the Mexican market, as the peso price of A American imports will rise following the peso's fall. (B) your firm will be able to charge more in dollar terms while keeping peso prices stable. (C) your domestic competitors will enjoy a period of facing lessened price competition from Mexican imports D) both b an(d c are correctSynergy Incorporated, a US based Multinational Company (MNC) manufacturing electrical appliances. The company currently having problem of increasing in labor cost and therefore it affects the company's has profit. The company has decided to reduce the cost. The Board of Directors is considering building a plant in South East Asia, Singapore and Indonesia are countries under consideration. Below are the estimatedcash flow and exchange rate for both countries. Singapore Indonesia Forecasted Cash Flow Forecasted Exchange Year Cash Flow (IND) Exchange (SGD) (USD/SGD) (USD/IDR) 2017 (300,000) SGD4.4852 (5,200,000) IDR49.582 2018 65,000 SGD4.0614 1,500,000 IDR49.9648 2019 52,000 SGD4.1323 1,600,000 IDR52.4211 2020 60,000 SGD4.0905 1,800,000 IDR50.6107 2021 75,000 SGD4.4028 2,500,000 IDR51.3034 Based on the information, compute the potential investment's net present value (NPV) for Singapore and Indonesia if the company has weighted cost of capital of 10 and 12 percent. Suggest which location…Suppose that Canada produces 1 million bicvcles a year and imports another 0.4 million. There is no tariff or import barrier. Bicycles sell for 400 dollars each. a 40 dollars tariff on bicycles. What is the minium national loss to Canada? O. 1 million dollar O. 0.5 million doliar O. 1.2 million dollar O. 0
- Given: A company XYZ in the United States is profitable and pays taxes. XYZ produces “widgets”, and in recent years, the cost of producing each widget has been falling because the price of raw materials has been falling. Each year for the past few years, XYZ has produced significantly more widgets each year than it has sold. True or False: XYZ would report lower Net Income on the Income Statement if it used FIFO accounting versus if it used LIFO accounting Explain your answer.Toyota company with extensive car related operations in Oman sends the profits it generates in Oman every month to On an average the company converts 2 million Rials into dollar and then into yen every month for transmission to Japan. Toyota finance manager is worried about the extreme fluctuations in the dollar – yen rate. Write in only one sentence, how Toyota can stabilize its cash flows ?Assume that a car costs 419,900 in Mexican pesos (MXN). The same car in the United States is sold for 25,000 in U.S. dollars (USD). The exchange rate is MXN 19.76 for USDI. Calculate how much profit a dealer can make on arbitrage from one car. Assume that costs of the car for dealers in the two countries are equivalent and so can be ignored as well as any overhead costs. Write the exact answer. Do not round.