You Are the Manager of a U

question 7

Multiple Choice

You are the manager of a U.S. firm that is undertaking a project in Hong Kong that will cost 10,000 Hong Kong dollars (HKD) . The current exchange rate is 7.8068 HKD/U.S. $. If the
Project generates cash flows of 12,000 HKD at the end of a year and the exchange rate at that
Point in time is 7.9192 HKD/U.S. $, what is its HKD rate of return? Round your answer to the
Nearest tenth of a percent.

• A)1.4%
• B)14.0%
• C)21.7%
• D)none of the above

Recognize the role of expectations in economics, especially regarding price levels.

Understand the impact of changes in the price level on consumption, investment, and net exports.

Acknowledge the reasons for and effects of economic fluctuations.

Understand how changes in the money supply affect interest rates, investment spending, and aggregate demand.

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Definitions:

Rule Oriented

A characteristic of behaviors or individuals that strictly follow established guidelines or protocols.

Freud

Sigmund Freud, an Austrian neurologist, pioneered psychoanalysis, a therapeutic approach for addressing mental disorders through conversations between a psychoanalyst and their patient.

Ethical

Pertaining to or dealing with morals or the principles of morality; pertaining to right and wrong in conduct.

Ego Ideal

In psychoanalysis, the part of the mind that serves as a standard for what one wants to achieve in terms of ethics, ambition, and self-regard.