Question

Is 0.9 USD/EUR to 0.95 USD/EUR an appreciation of the Euro and depreciation of the Us...

Is 0.9 USD/EUR to 0.95 USD/EUR an appreciation of the Euro and depreciation of the Us dollar? This is how my teacher has it marked. But I thought this meant that 1 usd is worth .90 Euros and it went to 1 usd is worth .95 usd. Wouldn't this mean the US dollar appreciated and not the Euro? This is a hypothetical situation.  

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

In the exchange rate 0.9 USD/EUR, EUR is the base currency. so in first exchange rate, 1 EUR is equal to 0.9 USD or if you sell 1 EUR then you will get 0.9 USD.

in second exchange rate, 1 EUR is equal to 0.95 USD or if you sell 1 EUR then you will get 0.95 USD. so in second exchange rate, that same 1 EUR is getting more no. of units of USD.

EUR has become more expensive or appreciated in second exchange rate and dollar has become cheaper or depreciated in second exchange rate.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the...
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the Euro to depreciate. What is your trading strategy? Discuss. How much would you invest in this strategy?
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the...
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the Euro to depreciate. What is your trading strategy? Discuss. How much would you invest in this strategy?
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the...
Assume the current Euro-Dollar exchange rate is 0.9 EUR/USD. Based on your analysis you expect the Euro to depreciate. What is your trading strategy? Discuss. How much would you invest in this strategy? Note: Not missing any other info or graphs.
A French investor recently purchased €20.5 million worth of US dollar denominated corporate bonds with 1...
A French investor recently purchased €20.5 million worth of US dollar denominated corporate bonds with 1 year until maturity that pay 5.5% percent interest annually. The current spot price of Euros for US dollars is €0.9/$1. a) Is the French investor to an appreciation or depreciation of the euro relative to the dollar? b) What will be the return on the bond (if held to maturity) if the euro depreciates relative to the dollar such that the spot rate of...
INTERNATIONAL FINANCE- PLEASE SHOW ALL WORK SO I CAN UNDERSTAND THE STEPS!!!! 1. A. Bid and...
INTERNATIONAL FINANCE- PLEASE SHOW ALL WORK SO I CAN UNDERSTAND THE STEPS!!!! 1. A. Bid and Ask quotes for the Euro (EUR) and Canadian Dollar (CAD) are given    below:           USD 0.7527 – 0.7570/CAD           USD 1.1712 – 1.1731/ EUR           Calculate the bid and ask cross rates: S (EUR/bid CAD) and S (EUR/ask CAD). 2. The EUR went from EUR 0.8540 per USD to EUR 0.8296 per USD in a month. A)What was the appreciation (or depreciation) of the...
Discussion Topic: Use “Euro-Disney Stumbles” (p. 130) from the textbook. (Adams & Galanes) The third dimension...
Discussion Topic: Use “Euro-Disney Stumbles” (p. 130) from the textbook. (Adams & Galanes) The third dimension is that of context. In a low-context culture, such as that of the United States and New Zealand, the verbal part of the message carries the meaning—what you say is exactly what you mean. If you say that you like my proposal, I can trust the fact that you really do like it. In a high-context culture, such as most Asian and Native American...
Please answer the following Case analysis questions 1-How is New Balance performing compared to its primary...
Please answer the following Case analysis questions 1-How is New Balance performing compared to its primary rivals? How will the acquisition of Reebok by Adidas impact the structure of the athletic shoe industry? Is this likely to be favorable or unfavorable for New Balance? 2- What issues does New Balance management need to address? 3-What recommendations would you make to New Balance Management? What does New Balance need to do to continue to be successful? Should management continue to invest...
Mattel Responds to Ethical Challenges Business Ethics This case was written by Debbie Thorne, John Fraedrich,...
Mattel Responds to Ethical Challenges Business Ethics This case was written by Debbie Thorne, John Fraedrich, O. C. Ferrell, and Jennifer Jackson, with the editorial assistance of Jennifer Sawayda. This case was developed for classroom discussion rather than to illustrate either effective or ineffective handling of an administrative, ethical, or legal discussion by management. All sources used for this case were obtained through publicly available material. Mattel, Inc. is a world leader in the design, manufacture, and marketing of family...
What tools could AA leaders have used to increase their awareness of internal and external issues?...
What tools could AA leaders have used to increase their awareness of internal and external issues? ???ALASKA AIRLINES: NAVIGATING CHANGE In the autumn of 2007, Alaska Airlines executives adjourned at the end of a long and stressful day in the midst of a multi-day strategic planning session. Most headed outside to relax, unwind and enjoy a bonfire on the shore of Semiahmoo Spit, outside the meeting venue in Blaine, a seaport town in northwest Washington state. Meanwhile, several members of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT