Excel Solutions - Chapter 22

Excel Solutions - Chapter 22 - Chapter 22 Problems 1-15...

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Unformatted text preview: Chapter 22 Problems 1-15 Input boxes in tan Output boxes in yellow Given data in blue Calculations in red Answers in green Chapter 22 Question 1 Input Area: a. Cash $100 Euro value per $ 1.2186 b. $ value per euro $0.8206 c. Euro amount 5,000,000 f. Pesos per $ 11.4850 Output Area: a. Euros 82.0614 b. One euro $1.2186 c. Dollar value $6,093,103 d. More worth Singapore dollar e. More worth Mexican peso f. # of Pesos/Euro 13.9959 This is a cross rate. g. Most valuable = Kuwait Dinar = $3.3920 Least valuable = Turkish Lira = $.00000067 Chapter 22 Question 2 Input Area: SF 100 100 US dollars $100 SF value per $ 0.8008 Pounds per $ 1.8301 Output Area: 100, since $54.642 100, since (SF) 43.7572 Cross rate SF/ 0.4376 Cross rate /SF 2.2853 Chapter 22 Question 3 Input Area: Spot /$ rate 107.9000 6 month /$ rate 106.8600 Spot $/C$ rate 1.3468 3 month $/C$ rate 1.3497 Output Area: The yen is selling at a premium because it is more expensive in the forward market than in the spot market $0.0092678 versus $0.0093580 The C$ is selling at a discount because it is less expensive in the forward market than in the spot market $0.7425007 versus $0.7409054 The value of the dollar will fall relative to the yen. The value of the dollar will rise relative to the Canadian dollar. Chapter 22 Question 4 Input Area: Spot exchange rate for CD $1.26 6-month forward rate for CD $1.22 Price of beer in Canada $2.19 Output Area: a. The U.S. dollar, since C$ = $0.7937 b. Price of beer in U.S. $1.7381 Among the reasons that absolute PPP doesn't hold are tariffs and other barriers to trade, transactions...
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Excel Solutions - Chapter 22 - Chapter 22 Problems 1-15...

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