​Great Manufacturing, Inc

question 44

Short Answer

​Great Manufacturing, Inc. has contracted to sell certain goods to a company in Austria. The price agreed upon for the goods is 900,000 euro. On the date the contract was signed, the euro was valued at $1.29. If the value of the euro rose from $1.29 to $1.30 on the date of payment, compute how much Great Manufacturing, Inc. gained by contracting in euros instead of U.S. dollars.

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Definitions:

Counterfactual Thinking

The mental process of imagining alternative outcomes to events that have already occurred.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to mind when evaluating a specific topic, concept, method, or decision.

Fundamental Attribution Error

The tendency to overestimate the influence of personality and underestimate the impact of situational factors on other people's behavior.

False Consensus Effect

The tendency for people to overestimate the extent to which their beliefs, opinions, preferences, values, and habits are normal and typical of those of others.