Suppose you are considering the purchase of a bond issued in another country. What calculations must you do to calculate the expected return on a foreign bond? Explain
What will be an ideal response?
You must first determine the amount of foreign currency you can obtain with one unit of domestic currency (E). You then must determine how much foreign currency you will obtain in one year after purchasing foreign bonds. And finally, you must then calculate how much domestic currency you will receive in one year when you convert the foreign currency back to domestic currency.
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The level of real GDP person
a. differs widely across countries, but the growth rate of real GDP per person is similar across countries. b. is very similar across countries, but the growth rate of real GDP per person differs widely across countries. c. and the growth rate of real GDP per person are similar across countries. d. and the growth rate of real GDP per person vary widely across countries.
When each firm is liable for taxes on total sales but can claim the taxes already paid by suppliers as a credit against liability we are using the
A. reserve method. B. chain method. C. invoice method. D. VAT method.