Question 1 Suppose 144 yen could be purchased in the foreign exchange market for

Question

Question 1

Suppose 144 yen could be purchased in the foreign exchange market for one U.S. dollar today. If the yen depreciates by 8.0% tomorrow, how many yen could one U.S. dollar buy tomorrow?
Answer

155.5 yen
144.0 yen
133.5 yen
78.0 yen
72.0 yen


.2 points
Question 2

Suppose 6 months ago a Swiss investor bought a 6-month U.S. Treasury bill at a price of $9,708.74, with a maturity value of $10,000. The exchange rate at that time was 1.420 Swiss francs per dollar. Today, at maturity, the exchange rate is 1.324 Swiss francs per dollar. What is the annualized rate of return to the Swiss investor?
Answer
-7.92%
-4.13%
6.00%
8.25%
12.00%

Explanation / Answer

Question 1 === Suppose 144 yen could be purchased in the foreign exchange market for one U.S. dollar today. If the yen depreciates by 8.0% tomorrow, how many yen could one U.S. dollar buy tomorrow? 144*1.08 = 155.52 Question 2 ==== 8.25%

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