Answer:
$1 = 122.84 Hungarian Forint
Explanation:
<em>The purchasing power parity theory states the future spot rate and and he current spot exchange rate between two currencies can be linked to the relative inflation rate between the two currencies. This also known as the law of one price.
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The model is given as follows:
S = So× (1+Fc)/(1+Fh)
Fc - inflation rate in Hungary - 6.9%
Fh- Inflation rate in the US- 2.8%
S- Future spot rate- ?
So- Current spot rate-188.13
Expected exchange rate one year from now
118.13× (1.069)/(1.028)
=122.8414
= 122.84 Hungarian Forint
$1 = 122.84 Hungarian Forint
Answer:
The correct answer to the following question is D) interest rates would be increased by the government when there is almost full employment in the economy.
Explanation:
When in the economy, business are producing close to productivity and in the nation there is almost full employment , then it can be said that the economy is booming . Which means there is good amount of money supply in the economy and people are spending robustly and that means the demand is high , which ultimately tells that the prices of goods and services are high.
So to cut the prices, government will increase the interest rate which will lead to the increase in cost of borrowing, and that will cause decrease in money supply and demand will ultimately fall, which leads to decrease in prices of goods and services.
Starbucks doesn't franchise.
Explanation:
Starbucks doesn't franchise because they want to run their own stores and can control the quality and profits.
In addiction, franchising is a way for companies to expand fast with less money. Starbucks is relying on their name to continue its success and growth. According to Starbuck's investor report , "Seattle's best coffee brand does offer franchise opportunities to qualified and select applicants , using a predefined set of criteria and focusing on multi-unit franchisees with a proven track record of success."
Starbucks pursues join ventures. Starbucks can be found in several grocery stores and retail stores. Starbucks has the name tights but it is using the location of these venues to promote the product and introduce new customers in the Starbuck's pool.
True.
For Accounts Payable denominated in a foreign currency, an increase in the direct exchange rate (dollar has weakened) results in an exchange gain.
<h3>What is an exchange gain or loss?</h3>
- A change in the exchange rate between the time an invoice was issued and the time it was paid results in an exchange gain or loss.
- An exchange gain or loss results when an invoice is entered at one rate and paid at another.
- The exchange rate at which the consumer pays for this invoice will ineluctably differ from the rate at which you recorded the invoice in your accounting system, even though you will have appropriately converted your prices.
- The cash you receive will be considerably more than what you initially invoiced as a result.
- This difference is known as an exchange gain or loss depending on which way the exchange rate has gone, i.e. whether the currencies involved have appreciated or depreciated in value (a gain or loss).
To learn more about exchange gain visit:
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