Suppose your company imports computer motherboards from Singapore. The exchange
ID: 2755941 • Letter: S
Question
Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.5136 S$/US$. You have just placed an order for 37,000 motherboards at a cost to you of 231.10 Singapore dollars each. You will pay for the shipment when it arrives in 90 days. You can sell the motherboards for $162 each. (Enter your answer as directed, but do not round intermediate calculations.)
Requirement 1: (a) Calculate your profit if the exchange rates stay the same over the next 90 days.(Round your answer to 2 decimal places (e.g., 32.16).) Profit $
(b) Calculate your profit if the exchange rate rises by 12 percent over the next 90 days.(Round your answer to 2 decimal places (e.g., 32.16).) Profit $
(c) Calculate your profit if the exchange rate falls by 12 percent over the next 90 days.(Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places (e.g., 32.16).) Profit $
Requirement 2: What is the break-even exchange rate? (Round your answer to 4 decimal places (e.g., 32.1616).) Break-even exchange rate S$ /$
Requirement 3: What percentage decrease does this represent in terms of the Singapore dollar versus the U.S. dollar? (Input the amount as positive value. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).) Percentage decrease %
Explanation / Answer
Answer : 1 (a)
Answer 1 (b) If Exchange rate rise by 12 %
= 1.5121 * 12/100 = 0.181452
= 1.5121-0.181452
= 1.3307/US $
Answer 1(c)
Answer 1 (b) If Exchange rate falls by 12 %
= 1.5121 * 12/100 = 0.181452
= 1.5121 +0.181452
= 1.6936/US $
Answer - 2
Answer 3 Present Exchange value = 1.5121 /US$
Exchange rate required = 1.4296 /US $
=1.5121-14296
= 0.0825
= 0.0825/1.5121*100
= 5.46%
Particulars amt in $ Sale price of 1 mother board 162.00 Cost of 1 mother board in $ '231.60/1.5121 153.16 Profit on 1 mother board 8.84 Profit on 22000 mother boards '22000*8.84 194480.00 Total Profit $ 194,480.00Related Questions
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