Instruction 16

question 38

Multiple Choice

Instruction 16.1:Use the information to answer the following question(s) .
In September 2009 a U.S. investor chooses to invest $500,000 in German equity securities at a then current spot rate of $1.30/euro. At the end of one year the spot rate is $1.35/euro.
-Refer to Instruction 16.1. At the end of the year the investor sells his stock that now has an average price per share of €57. What is the investor's average rate of return before converting the stock back into dollars?

• A)5.0%
• B)-3.0%
• C)-5.0%
• D)3.0%

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Definitions:

Emerging Adulthood

A phase of life between adolescence and full-fledged adulthood that encompasses late teens through the twenties, marked by exploration of identity.

Adolescence

A developmental stage between childhood and adulthood characterized by significant physical, psychological, and social changes, including puberty and identity exploration.

Empty-nest Syndrome

A feeling of grief and loneliness parents may feel when their children leave home for the first time, such as to live on their own or attend college.

Concrete Operational Stage

A phase in Piaget's theory of cognitive development (ages 7-12), where children gain a better understanding of mental operations and can think logically about concrete events.