15. The real rate of return in Sudan was expected to be 4% and inflation there was 82.4% in 2020. What was the nominal rate in that nation? a. 91.10% b. 88.55% c. 89.70% d. 90.18%
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15. The real
a. 91.10% b. 88.55% c. 89.70% d. 90.18%
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- Finance Suppose the year 1, year 2 and year 3 forecasts for the rate of inflation in Denmark are 3%, 4% and 5% respectively. Suppose also that the year 1, year 2 and year 3 forecasts for the rate of inflation in France are 11%, 9% and 8% respectively. If the expected spot rate between the Danish Krone (DKK) and the EUR is EUR0.1344/DKK at the end of year 3, what is the current spot rate?Suppose the year 1, year 2 and year 3 forecasts for the rate of inflation in Denmark are 3%, 4% and 5% respectively. Suppose also that the year 1, year 2 and year 3 forecasts for the rate of inflation in France are 11%, 9% and 8% respectively. If the expected spot rate between the Danish Krone (DKK) and the EUR is EUR0.1344/DKK at the end of year 3, what is the current spot rate? a.EUR0.119024/DKK b.EUR0.151762/DKK c.EUR0.111027/DKK d.EUR0.128269/DKK e. Not enough information to answer this question.Suppose annual inflation rates in the United States and Mexico are expected to be 6 percent and 80 percent, respectively, over the next several years. If the current spot rate for the Mexican peso is $.005, then the best estimate of the peso's spot value in three years is ________. Group of answer choices a$.00276 b$.01190 c$.00321 d$.00102
- Suppose the year 1, year 2 and year 3 forecasts for the rate of inflation in Denmark are 3%, 4% and 5% respectively. Suppose also that the year 1, year 2 and year 3 forecasts for the rate of inflation in France are 11%, 9% and 8% respectively. If the expected spot rate between the Danish Krone (DKK) and the EUR is EUR0.1344/DKK at the end of year 3, what is the current spot rate? a. EUR0.119024/DKK b. EUR0.151762/DKK c. EUR0.128269/DKK d. EUR0.111027/DKK e. Not enough information to answer this question.3. The expected inflation rate in Oman is 3.5%. The current spot rate between OMR and INR is INR174.325/OMR and the expected spot exchange rate in one year is INR176.435/OMR. How much is the expected inflation rate in India?Malaysia’s inflation is expected to be 1.25% and Thailand’s inflation is expected to be 0.95% next year.Given the spot value of Thai baht (THB) is MYR0.1320, compute the real value of THB for next year.
- (b) Assume AUD = 0.58 GBP and inflation is 3.5% pa in Australia and 7% pa in Great Britain. Estimate the AUD/GBP spot rate in one year's time and comment on the accuracy of this estimate.Suppose annual inflation rates in the U.S. and Mexico are expected to be 6.5% and 75%, respectively, over the next several years. If the current spot rate for the Mexican peso is $0.05, then the best estimate of the peso's spot value in 3 years is a . $.01190 b . $0.0113 c . $.00321 d . $.00276Deriving Forecasts of the Future Spot Rate As of today, assume the following information is available: U.S. MEXICO Real rate of interest required by investors 2% 2% Nominal interest rate 11% 15% Spot rate — $.20 One-year forward rate — $.19 Use the forward rate to forecast the percentage change in the Mexican peso over the next year. Use the differential in expected inflation to forecast the percentage change in the Mexican peso over the next year. Use the spot rate to forecast the percentage change in the Mexican peso over the next year.
- Suppose inflation rates in the U.S. and France are expected to be 4% and 9%, respectively, next year and 6% and 7%, respectively, in the following year. If the current spot rate is $.1050, then the expected spot value of the franc in two years is a. $.1111 b. $.0992 c. $.1074 d. $.1024Suppose annual inflation rates in the U.S. and Mexico are expected to be 6% and 80%, respectively, over the next several years. If the current spot rate for the Mexican peso is $.005, then the best estimate of the peso's spot value in 3 years is a.$.01190 b.$.00276 c.$.00321 d.$.00102Let the inflation rate in Belize be 3.3%. At the same time, the inflation rate in the U.S. is 2.9%. According to PPP, the Belize dollar (BBD) should ___________ by _________%. a . appreciate; 0.387% b . depreciate; 1.387% c . depreciate; 0.387% d . appreciate; 1.387%
