What is the difference between a target zone and a crawling peg?
What will be an ideal response?
In a target zone, the currency is allowed to fluctuate in a percentage band around a "central value." One can view a pegged system as a target zone system with a very narrow band. In a crawling peg system, the fixed rate or band is adjusted over time, typically in a pre-determined way as a function of the inflation differential between the crawling peg country and the country to whose currency the peg is set. Such a system is often used in developing countries, where the "crawl" of the band prevents the country from losing too much competitiveness when its inflation rate is higher than that of the benchmark country.
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The direct materials budget is prepared using information from the ________ budget
A) cash B) master C) capital expenditure D) production
Off Road Concepts, Inc produces a special kind of light-weight, recreational vehicle that has a unique design
It allows the company to follow a cost-plus pricing strategy. It has $9,000,000 of average assets, and the desired profit is a 7% return on assets. Assume all products produced are sold. Additional data are as follows: Sales volume 2,000 units per year Variable costs $1,000 per unit Fixed costs $3,500,000 per year Using the cost-plus pricing approach, what should be the sales price per unit? A) $3,065 B) $8,000 C) $1,070 D) $1,000