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Alexandra [31]
2 years ago
11

Assume $1 is currently equal to A$1.1024 in the spot market. Also assume the expected inflation rate in Australia is 2.8 percent

as compared to 3.4 percent in the U.S. What is the expected exchange rate one year from now if relative purchasing power parity exists?
Business
1 answer:
MatroZZZ [7]2 years ago
8 0

Answer:

Future rate(AUD/USD) = 1.0958

Explanation:

Consider the following formula to calculate the future rate

Future rate=Spot rate*((1+Quoted currency Inflation rate)/(1+Base currency Inflation rate))^time

Future rate=1.1024*((1+0.028)/(1+0.034))^1

Future rate(AUD/USD) = 1.0958

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Preparing, reading, capturing key ideas, and reviewing.

Explanation:

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An optimizing consumer will select the consumption bundle in which the :
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c. marginal rate of substitution is equal to the relative price ratio of the goods.

Explanation:

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Therefore, The marginal rate of substitution is equal to the relative price ratio of the goods.

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Precision Engineering Inc., like other corporations, is subject to laws that are broad in their purpose and their scope. Complia
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A) the law does not codify all ethical requirements.

Explanation:

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3 years ago
A sharing arrangement in which only deductible costs are apportioned to the investor, with the sponsor bearing all capitalized c
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D) functional allocation

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3 years ago
On January 1, 2020, the Oriole Company had $2,990,000 of $10 par value common stock outstanding that was issued at par and Retai
amm1812

Answer:

Oriole Company

Journal Entries:

July 1:

Debit Cash Account $2,336,000

Credit Common Stock $1,460,000

Credit Paid-in In Excess of Common Stock $876,000

To record the issuance of 146,000 shares of common stock, par $10 at $16 per share.

December 15:

Debit Retained Earnings $445,000

Stock Dividends Payable $445,000

To record the declaration of a 10% stock dividend.

Explanation:

a) Stockholders of record on December 31, 2020:

Number of shares in issue at beginning 299,000

Number of shares issued on July 1          146,000

Total                                                          445,000

10% of 445,000 = 44,500 shares

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2 years ago
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