Question

Tee Time Golf Resort plans to use famous Kauri wood from New Zealand for parts of the interior of the magnificent clubhouse at its new golf resort near Salem, OR. According to the importer, each 10-foot slab will cost Tee Time approximately $5,000. Looking at the exchange rates, Tee Time's finance director noted that $500 US dollars = $738 NZ dollars. The importer will order directly from his source in New Zealand. Tee Time's finance director has determined tha:______________.t
A. there will be a shortage of the wood.
B. it will cost less when the exchange rate of U.S. dollars to NZ dollars is just about equal.
C. it's a good time to buy the wood.
D. it's not a good time to buy the wood.

Answer 1

Answer:

correct option is C. it's a good time to buy the wood.

Explanation:

given data

slab = 10 feet

cost Tee Time =  $5,000

$500 US dollars = $738 NZ dollars

solution

If they import timber from New Zealand. Tea Golf Resort pays less than $ 5000 to import Wood from New Zealand at the current exchange rate. This is a good time for them to import forests

we get here current exchange rate of 1 dollar that is as

US $500 = NZ $738

so $1 = $\frac{738}{500}$  

$1 = NZ  $1.476

current exchange rate is $1 = NZ $1.476

so

10 foot slab costs $5000

so Tee Golf Resort will pay is

Tee Golf Resort pay = $\frac{5000}{1.476}$  

Tee Golf Resort pay = $3387.53

so correct option is C. it's a good time to buy the wood.