1. (a) assume that the exchange rate between the u. s. dollar ($) and the mexican peso (p) is pegged at er=$1/p4. assume that, initially, this exchange rate corresponds to equilibrium in the foreign exchange market. illustrate the initial situation in the market for peso-denominated deposits using demand and supply curves.

(b) the united states now undertakes an economic policy that puts upward pressure on the interest rate on dollar-denominated deposits (i). mexico follows an economic policy that puts downward pressure on the interest rate on peso-denominated deposits (i*). explain and illustrate effects of the two countries’ policies in the foreign exchange market in the graph you draw in (a). if the exchange rate between the dollar and the peso had been flexible rather than fixed, what would happen?

(c) if mexico maintains its commitment to hold the exchange rate at $1/p4, what actions must the mexican central bank take? explain.

(d) if the united states and mexico continue to follow the economic policies outlined in part (b) above, what will happen if the mexican central bank continues to take the action described in part (c)?

(e) suppose you are a participant in the foreign exchange market. given your answer to (d), how might you adjust your expectation of the future dollar price of the peso ( )? what effect would this have on the foreign exchange market? would it make the mexican central bank’s job easier or more difficult? why?

On analyzing her company’s goods transport route, simone found that they could reduce transport costs by a quarter if they merged different transport routes. what role (job) does simone play at her company? simone is at her company.

Fred smithers, a recent college graduate decided to open his own portable juice bar, smithers smoothies, to wheel around newport beach. you, a trusted friend of fred, are a business major that has also recently graduated and agreed to handle the books for a while to get some practical experience and have a favor that you can ask of fred in the future. given the following five transactions concerning the new venture, prepare the necessary journal entries for the transactions, post the journal entries to appropriate t accounts and prepare a trial balance as of the end of the month in order to answer to the necessary may 2: fred invests $12,000 of his own money to start the new company. this money was obtained from a part-time job working at a legal firm while he was in school. may 3: fred spent $5,100 cash to purchase a refrigerated trailer that he can pull behind his car and set up at the beach. under your advice, fred agrees to place the new asset under an account called "equipment." may 6: fred bought $640 of supplies on account from the flav-o-rite confectioners company. because they will last longer than a single accounting period fred agrees to record them as, "supplies" as per your suggestion. may 13: fred sat on the beach for six hours without a single sale and was feeling very down. right before he left, however, a plumber escorting his family reunion along the beach stopped by his stand and bought $800 worth of smoothies for the entire family. under your advice, fred agrees to call this cash revenue, "sales." may 15: excited about his new venture, fred withdraws $350 from the company to take his girlfriend out to dinner. what would be the balance in the cash account at the end of the period following the posting of all the transactions?

Presented below is information for annie company for the month of march 2018. cost of goods sold $245,000 rent expense $ 36,000 freight-out 7,000 sales discounts 8,000 insurance expense 5,000 sales returns and allowances 11,000 salaries and wages expense 63,000 sales revenue 410,000 instructions prepare the income statement.