Suppose one year ago, Hein Company loan payables outstanding in British pound valued at 440,000 pounds. The exchange rate for dollars to pounds was 1£ = 1.75 U.S. dollars. This year the exchange rate is 1£ = 1.45 U.S. dollars. Heinz loan payables in Britain is still valued at 440,000 pounds. What is the gain (+) or loss (-) in loan payables value in U.S. dollars as a result of the change in exchange rates?(Please show work)
Suppose one year ago, Hein Company loan payables outstanding in British pound valued at 440,000 pounds. The exchange rate for dollars to pounds was 1£ = 1.75 U.S. dollars. This year the exchange rate is 1£ = 1.45 U.S. dollars. Heinz loan payables in Britain is still valued at 440,000 pounds. What is the gain (+) or loss (-) in loan payables value in U.S. dollars as a result of the change in exchange rates?(Please show work)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Suppose one year ago, Hein Company loan payables outstanding in British pound valued at 440,000 pounds. The exchange rate for dollars to pounds was 1£ = 1.75 U.S. dollars. This year the exchange rate is 1£ = 1.45 U.S. dollars. Heinz loan payables in Britain is still valued at 440,000 pounds. What is the gain (+) or loss (-) in loan payables value in U.S. dollars as a result of the change in exchange rates?(Please show work)
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