Calculate the Euro-Based Return an Italian Investor Would Have Realized

question 77

Essay

Calculate the euro-based return an Italian investor would have realized by investing €10,000 into a £50 British stock.One year after investment,the stock has no value since the firm is bankrupt.Meanwhile the exchange rate has changed from €1.25 per pound to €1.30 per pound,and he sold £8,000 forward at the forward rate of €1.28 per pound.

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Definitions:

Loyalty Programs

Marketing strategies designed by businesses to encourage repeat customers by offering rewards, discounts, or other incentives.

Globalization

The process by which businesses or other organizations develop international influence or start operating on an international scale, often associated with cultural and economic integration.

Competitive Forces

Elements in the external environment that influence an organization's competitive position, including competition, customer power, supplier power, the threat of new entrants, and the threat of substitute products or services.

Porter

Michael Porter, a renowned economist known for his theories on economics, business strategy, and competitive advantage.