1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
denis-greek [22]
2 years ago
10

Assume that you have a subsidiary in Australia. The subsidiary sells mobile homes to local consumers in Australia, who buy the h

omes using mostly borrowed funds from local banks. Your subsidiary purchases all of its materials from Hong Kong and pays Hong Kong dollar. The Hong Kong dollar is tied to the U.S. dollar. Your subsidiary borrowed funds from the U.S. parent, and must pay the parent $100,000 in interest each month. Australia has just raised its interest rate in order to boost the value of its currency (Australian dollar). The subsidiary’s cost of purchasing materials measured in Australian dollar will ____________. A. increase B. decrease C. not change
Business
1 answer:
Nat2105 [25]2 years ago
4 0

Answer:

B. decrease

Explanation:

The subsidiary's cost of purchasing materials measured in Australian dollar will decrease. The subsidiary in Australia sells mobile homes. It borrows funds from local bank and purchases material from Hong Kong and pays Hong Kong in HK$ which is tied to US dollar. So when Australian dollar appreciates against the Hong Kong dollar, it will appreciate against US dollar as the Hong Kong dollar is tied to US dollar. The subsidiary will pay decreased cost of purchasing material due to appreciations of A$ by increasing interest rate in Australia.  

You might be interested in
Debt: 5,000 7.2 percent coupon bonds outstanding, $1,000 par value, 30 years to maturity, selling for 108 percent of par; the bo
Tju [1.3M]

Answer:

outstanding, $1,000 par value, 30 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 440,000 shares outstanding, selling for $62 per share; the beta is 1.05. Market: 11 percent market risk premium and 5.2 percent risk-free rate. What is the company's WACC

4 0
3 years ago
Paden Company purchased merchandise from Emmett Company with freight terms of FOB shipping point. The freight costs will be paid
Nikitich [7]

Answer:

Buyer (Paden Company)

Explanation:

The freight costs will be paid by the Buyer. FOB shipping point means that the Buyer takes all the risks and rewards associated with the purchase as soon as the goods leave sellers location.

8 0
3 years ago
Oakleaf Manufacturing incurs costs of $75 ($67 variable and $8 fixed) to make a product that normally sells for $120. A customer
aleksandr82 [10.1K]

Answer:D. reject the offer because it will produce a net loss $21,000

Explanation:

Net income or loss is the total of firm's income less it's total cost( fixed and variable) . The contract will result in a loss $5 per unit which multiply by the total units of 4200 gives $21,000

7 0
3 years ago
С
lozanna [386]

Answer:

I think C is correct answer

8 0
2 years ago
Why do we have to have an internet connection to use this app
Sergeeva-Olga [200]
Basically Brainly is an academic version of Facebook. It allows for the real-time communication of people who either need help or are helping.
8 0
3 years ago
Other questions:
  • Questions in Web surveys often use drop-down boxes as a manner of displaying the response choices for a question. This type of d
    13·1 answer
  • Do you think that modern society has contributed to the number of youth suicides? Why or why not?
    12·2 answers
  • What are basic features of Usenet groups?
    7·1 answer
  • In your research project on tourism, you must collect data before the tourist season ends because the project requires interview
    11·2 answers
  • Bob's Butcher Shop is the only place within 100 miles that sells bison burgers. Assuming that Bob is a monopolist and maximizing
    14·2 answers
  • Answer the question on the basis of the following information. Assume that if the interest rate that businesses must pay to borr
    6·1 answer
  • There are costs and benefits to either method of solving a Capitalizing Problem.<br> True or False?
    11·1 answer
  • Match the term with its definition Question 2 options: a method of advertising or selling that uses false claims to lure people
    14·1 answer
  • ________ refers to the strategy of getting visitors to a Web site to forward information on the site of their friends in order t
    8·1 answer
  • True or false: stakeholders are individuals or companies that legally own a portion of the company and are not influenced by the
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!