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never [62]
3 years ago
14

Suppose purchasing power parity holds. If the price level in the United States is 100 dollars per good and the price level in Ja

pan is 250 yen per good, then the nominal exchange rate is ________ yen per dollar.
Business
1 answer:
Korolek [52]3 years ago
6 0

Answer: 2.5 Yen

Explanation;

The Economic theory of Purchasing Power Parity when held, believes that prices of goods in different countries are the same if their exchange rates are taken into account.

For the above therefore it means that the price of the good is the same in both the US and Japan barring exchange rates.

Exchange rate is;

$100 = ¥250

$1 = 250/100

$1 = ¥2.5

Exchange rate is 2.5 yen per dollar.

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5 0
2 years ago
The Green Fiddle is considering a project with sales of $86,800 a year for the next four years. The profit margin is 6 percent,
-Dominant- [34]

Answer:

This project should be rejected  because the AAR is 10.68 percent.

Explanation:

The accounting rate of return of the project needs to computed,compared with the required accounting rate of return  in order to decide whether the project should accepted or rejected:

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8 0
3 years ago
Bruce & Co. expects its EBIT to be $100,000 every year forever. The firm can borrow at 11 percent. Bruce currently has no de
zhenek [66]

Answer:

15.16 percent

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3 0
3 years ago
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