Douglas & Reynolds, a Financial Firm, Has Recently Fallen on Hard

question 37

Short Answer

Douglas & Reynolds, a financial firm, has recently fallen on hard times. Its CEO notes that the firm has lost money for three straight years. Over the same period, the euro has lost 15 percent of its value, while the Chinese yuan has increased its value by 15 percent. He therefore concludes that the company should discontinue its foreign currency investments in the euro in favor of the yuan in order to increase its profits.
Which of the following, if true, most weakens the CEO's argument?
Over the last ten years, investments in the yuan have only marginally outperformed investments in the euro.
Research shows that a vast majority of American voters approve of European governments and disapprove of the Chinese government.
The amount of capital the company currently has invested in the euro is significantly larger than the amount invested in the yuan.
In the past six months, Europe has shown signs of recovering from a financial crisis, while China has shown signs of entering one.
A competing firm recorded record profits after shifting its investments from Japanese yen to Canadian dollars.

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Definitions:

International Quality Standards

Guidelines and specifications established by international bodies to ensure products, services, and systems' consistency and quality across countries.

Value Chain

The sequence of activities that a company performs to design, produce, market, deliver, and support its product, adding value at each step.

Consecutive Steps

Sequential steps or actions that follow one directly after the other without interruption or deviation.

Inputs

The resources, materials, or information that are required to produce goods or services in a business or manufacturing process.