Finance Week 7 Problems Set

Question 1

1. Suppose the exchange rate between U.S. dollars and Swiss francs is SF 1.3526 = $1.00, and the exchange rate between the U.S. dollar and the euro is $1.00 = 0.9672 euros. What is the cross-rate of Swiss francs to euros (SF/Euro)?

Enter your answer rounded off to FOUR decimal points.

1 points

Question 2

1. The exchange rate is 0.957 Swiss francs per U.S. dollar. How many U.S. dollars are needed to purchase 2,369 Swiss francs?

Enter your answer rounded off to two decimal points. Do not enter $ in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box.

1 points

Question 3

1. You just returned from a trip to Venezuela and have 4,644 bolivares fuertes in your pocket. How many dollars will you receive when you exchange this money if the U.S. dollar equivalent of the bolivares fuertes is 0.1565?

Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box.

1 points

Question 4

1. ABC Company sells 2,362 chairs a year at an average price per chair of $145. The carrying cost per unit is $22.51. The company orders 225 chairs at a time and has a fixed order cost of $103.8 per order. The chairs are sold out before they are restocked. What are the total carrying costs?

Enter your answer rounded off to two decimal points. Do not enter comma or $ in the answer box. For example, if your answer is 12.345 then enter as 12.35 in the answer box.

1 points

Question 5

1. Suppose it takes 1.47 U.S. dollars today to purchase one British pound today. Currency forecasters predict that the U.S. dollar will depreciate by 19% against the pound over the next 30 days. What is the Pound/US Dollar exchange rate in 30 days?That is, how many pounds can 1 dollar buy in 30 days?

Enter your answer rounded off to FOUR decimal points.

1 points

Question 6

1. The exchange rate is 0.9314 Swiss francs per U.S. dollar. How many U.S. dollars are needed to purchase 1 Swiss franc?

Enter your answer rounded off to two decimal points. Do not enter $ in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box.

1 points

Question 7

1. Suppose it takes 1.39 U.S. dollars today to purchase one British pound today. Currency forecasters predict that the U.S. dollar will depreciate by 19% against the pound over the next 30 days. What is the U.S. dollar/Pound exchange rate in 30 days?

Enter your answer rounded off to FOUR decimal points.

1 points

Question 8

1. ABC Company sells 3,444 chairs a year at an average price per chair of $181. The carrying cost per unit is $29.79. The company orders 500 chairs at a time and has a fixed order cost of $83 per order. The chairs are sold out before they are restocked. What is the economic order quantity?

Enter your answer rounded off to two decimal points. Do not enter comma in the answer box. For example, if your answer is 12.345 then enter as 12.35 in the answer box.

1 points

Question 9

1. ABC Company sells 2,324 chairs a year at an average price per chair of $144. The carrying cost per unit is $57.9. The company orders 402 chairs at a time and has a fixed order cost of $38 per order. The chairs are sold out before they are restocked. How many orders will company place if it follows the economic order quantity model?

Enter your answer rounded off to two decimal points. Do not enter comma in the answer box. For example, if your answer is 12.345 then enter as 12.35 in the answer box.

1 points

Question 10

1. ABC Company sells 3,965 chairs a year at an average price per chair of $178. The carrying cost per unit is $15.13. The company orders 236 chairs at a time and has a fixed order cost of $94.8 per order. The chairs are sold out before they are restocked. What are the total shortage costs?

Enter your answer rounded off to two decimal points. Do not enter comma or $ in the answer box. For example, if your answer is 12.345 then enter as 12.35 in the answer box.

1 points

Question 11

1. Suppose one U.S. dollar can purchase 151 yen today. If the yen depreciates by 7% tomorrow, how many yen could one U.S. dollar buy tomorrow?

Enter your answer rounded off to two decimal points. For example, if your answer is 12.345 then enter as 12.35 in the answer box.

1 points

Question 12

1. Suppose the exchange rate between U.S. dollars and Swiss francs is SF 1.0416 = $1.00, and the exchange rate between the U.S. dollar and the euro is $1.00 = 0.9155 euros. What is the cross-rate of euros to Swiss francs (Euro/SF)?

Enter your answer rounded off to FOUR decimal points.

1 points

Question 13

1. Your friend from Germany has decided to come and visit you in the United States. You estimate the cost of her trip at $7,755. What is the cost to her in euros if the U.S. dollar equivalent of the euro is 1.3203?

1 points

Question 14

1. You can exchange $1 for either C$1.209 or ¥114.09. What is the cross rate between the Japanese yen and the Canadian dollar? That is, solve for ¥ per C$.

Enter your answer rounded off to two decimal points.

1 points

Question 15

In New York, you can exchange $1 for €0.8698 or £0.6758. Suppose that, in Berlin, £1 costs €1.1981. How much profit can you earn on $31,683 using triangle arbitrage?

Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer