Tuesday
September 23, 2014

Homework Help: finance

Posted by Sara on Thursday, May 5, 2011 at 8:13pm.

Assume that the export price of a Nissan XTerra from Osaka, Japan is ¥3,750,000. The exchange rate is ¥121.84/$. The forecast rate of inflation in the United States is 2.8% per year and is 0.6% in Japan.
a. What is the export price of the XTerra at the beginning of the year expressed in US dollars?
b. Assuming purchasing power parity holds, what should the exchange rate be at the end of the year?
c. Assuming 100% pass-thru of exchange rate changes, what should be the dollar price of an XTerra at the end of the year?
d. Assuming 75% pass-thru of exchange rate changes, what should be the dollar price of an XTerra at the end of the year?

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

Econ - Assume that American rise sells for $100 per bushel, Japanese rice sells...
Microecomics - Assume that American rise sells for $100 per bushel, Japanese ...
econ (economyst please help) - I got this long question i am not sure how to do...
Economic Question - Sorry, this is a little long, hope somebody could give me ...
eco - Assume that American rice sells for $100 per bushel, Japanese rice sells ...
Finance - Given her evaluation of current economic conditions, Ima Nutt believes...
economics - the currency in Great Britain is pound and the price of a particular...
Economics - Assume that the United States operates under a flexible exchange ...
International Macroeconomics (struggling :\ ) - Assume that the United States ...
Economics - “Many countries peg their own currencies to the greenback; these ...

Search
Members