What is the new exchange rate for the yen

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1. The inflation rate in the U.S. is 3%, while the inflation rate in Japan is 2%. The current exchange rate is $1 equal to 101 Japanese yen. If purchasing power parity condition is existed, what is the new exchange rate for the yen?

2. The interest rate in the U.K. is 2%, while the interest rate in the U.S. is 1.5%. The spot rate for the British pound is $1.45. According to the international Fisher effect (IFE), what is new level of the British pound?

3. Bronco Co. is a U.S.-based MNC that has subsidiaries in Spain and Germany. Both subsidiaries frequently remit their earnings back to the parent company. The Spain subsidiary generated a net outflow of €1,000,000 this year, while the German subsidiary generated a net inflow of €2,500,000. What is the net inflow or outflow as measured in U.S. dollars this year? The exchange rate for the euro is $1.27.

Reference no: EM131863924

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