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Perform a convenience translation into u. dollars

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Reference no: EM132319422

Question

The British trading company Heseltine Ltd. exhibits the following sales revenue pattern (in thousands of British pounds):
                       2009      2010          2011

Sales revenue   £23,500    £28,650    £33,160

Required:

a.) Perform a convenience translation into U.S. dollars for each year given the following exchange rates:

2009   $2.10 = £1

2010   $2.20 = £1

2011  $1.60 = £1

b.) Compare the year-to-year percentage changes in sales revenues in pounds and in U.S. dollars. Do the two time series move in a parallel fashion? Why or why not?

c.) What method would minimize the effect of exchange rate changes on foreign currency trend data?

Reference no: EM132319422

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