When the Exchange Rate S_¥/$ Was 100,a U

question 2

Multiple Choice

When the exchange rate S_¥/$ was 100,a U.S.firm imports one Toyota automobile at ¥1,000,000 and agrees to make payments 60 days from the day of contract signing.On day 45,the exchange rate value changes to S_¥/$ = 80,what would happen to the U.S.import value from this exchange rate change?

• A) If the contract is written in dollar, the import value decreases.
• B) If the contract is written in dollar, the import value increases.
• C) If the contract is written in yen, the import value decreases.
• D) If the contract is written in yen, the import value increases.

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Definitions:

Degrees of Freedom

The number of independent values or quantities which can be assigned to a statistical distribution or to determine the distribution's parameter.

Chi-Squared Test Statistic

A value used in chi-squared tests to evaluate how likely observed frequencies of events are to occur under a specific hypothetical distribution.

Expected Value

In probability theory, the sum of all possible outcomes of a particular situation, each multiplied by its likelihood of happening.

Sample Size

Sample size refers to the number of observations or data points collected in a sample from a population for the purpose of statistical analysis.