The real exchange rate ( RER ) is the ratio of the price level abroad and the domestic price level.
RER = ( Nominal Exchange Rate x Foreign Price ) / ( Domestic Price )
The price of sofa is 2,400 pesos in Argentina and the nominal exchange rate is 4 pesos per dollar ( 2,400 : 4 = $600 )
RER = 4 x $600 / $800 = 3
Answer: The Real Exchange Rate is 3 pesos per dollar.
Answer:
a.) increased the after-tax cost of debt
Explanation:
Missing options are:
a.) increased the after-tax cost of debt
b.) did not change the after-tax cost of debt
c.) increased the value of the deduction for interest expense
d.) decreased the after-tax cost of debt
The after tax cost of debt is calculated by multiplying the debt's principal x interest rate x (1 - tax rate). If the tax rate decreases, the after tax cost of debt increases. e.g.
$1,000 owed at 6%, when tax rate was 40% ⇒ after tax cost of debt = $1,000 x 6% x (1 - 40%) = $36 or 3.6%
now, $1,000 owed at 6%, when tax rate is 21% ⇒ after tax cost of debt = $1,000 x 6% x (1 - 21%) = $47.40 or 4.74%
Explanation:
All tenders should be submitted on the appropriate tender forms as issued by trasnet and as per instructions in the bid documentation
Feedback Control <span>is a mechanism for gathering information about performance deficiencies after they occur.</span>