Decompose the Return an American Would Have If He Had

question 36

Multiple Choice

Decompose the return an American would have if he had bought a German stock at €100 per share and sold it one year later at €120. The spot exchange rate one year ago was $1.50 = €1 and the spot rate prevailing at the end of the year was $1.55 = €1.

• A)24% total return; 20% asset return; 4% attributable to exchange rate changes
• B)20% total return; 16.77% asset return; 3.23% attributable to exchange rate changes
• C)24% total return; 20% asset return; 3.33% attributable to exchange rate changes
• D)None of the above

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Definitions:

Extraverts

Individuals characterized by their outgoing, sociable, and energetic behavior, often drawing energy from interacting with others.

Introverts

Individuals who tend to be more inward turning, focusing on internal thoughts, feelings, and moods rather than seeking out external stimulation.

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Voluntary actions of employees that contribute to the organization but are not part of their formal job requirements.

Big Five

Refers to the five broad personality traits used in psychology to describe human personality: openness, conscientiousness, extraversion, agreeableness, and neuroticism.