Suppose a U.S. investor wishes to invest in a British firm currently selling for

Question

Suppose a U.S. investor wishes to invest in a British firm currently selling for £125 per share. The investor has $60,000 to invest, and the current exchange rate is $2/£.

Fill in the table below for rates of return after one year in each of the nine scenarios (three possible prices per share in pounds times three possible exchange rates).(Leave no cells blank - be certain to enter "0" wherever required. Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)

Dollar-Denominated Return (%)
for Year-End Exchange Rate

Suppose a U.S. investor wishes to invest in a British firm currently selling for £125 per share. The investor has $60,000 to invest, and the current exchange rate is $2/£.

Explanation / Answer

      current exchange rate is $2/£.

So after conversion in pound $60,000 become £30,000.

Now cost of one share = $125

Investor can purchase $30,000 / $125 = 240 Share of us firm.

B. Fill in the table below for rates of return after one year in each of the nine scenarios (three possible prices per share in pounds times three possible exchange rates)

For this qustion need some additional informetion.

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