Postal Express has outlets throughout the world. It also keeps funds for transactions purposes in many foreign countries. Assume in 2010 it held 280,000 reals in Brazil worth 210,000 dollars. It drew 9 percent interest, but the Brazilian real declined 18 percent against the dollar. a. What is the value of its holdings, based on U.S. dollars, at year-end? (Do not round intermediate calculations.) b. What is the value of its holdings, based on U.S. dollars, at year-end if instead it drew 6 percent interest and the real went up by 10 percent against the dollar? (Do not round intermediate calculations.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter22: International Financial Management
Section: Chapter Questions
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Postal Express has outlets throughout the world. It also keeps funds for transactions purposes in many foreign countries. Assume in 2010 it held 280,000 reals in Brazil worth 210,000 dollars. It drew 9 percent interest, but the Brazilian real declined 18 percent against the dollar.

a. What is the value of its holdings, based on U.S. dollars, at year-end? (Do not round intermediate calculations.)


b. What is the value of its holdings, based on U.S. dollars, at year-end if instead it drew 6 percent interest and the real went up by 10 percent against the dollar? (Do not round intermediate calculations.)

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