Exchange rate movements Suppose a basket of goods in Paris costs euro 134 and the same basket purchased in New York costs $ 152. a. At what exchange rate between euros and dollars is the cost of the basket the same in each city? b. Now suppose that over the next year inflation in France is expected to be 3% while in the U. S. the forecast is for 6% inflation. What exchange rate do you expect a year from now?

If temper company, a manufacturer of mattresses, was considering moving its production facilities to china but decided against it because the additional costs of shipping the mattresses back to the u.s. would offset the cost savings associated with moving the production facilities, the increased costs associated with shipping would be an example ofanswers: learning-curve economies.diseconomies of scale.economies of scale.competitive advantages.

Bond x is noncallable and has 20 years to maturity, a 7% annual coupon, and a $1,000 par value. your required return on bond x is 10%; if you buy it, you plan to hold it for 5 years. you (and the market) have expectations that in 5 years, the yield to maturity on a 15-year bond with similar risk will be 9.5%. how much should you be willing to pay for bond x today? (hint: you will need to know how much the bond will be worth at the end of 5 years.) do not round intermediate calculations. round your answer to the nearest cent.

Use this image to answer the following question. when the economy is operating at point b, the us congress is most likely to follow