Valley Harps Ltd, a Trinidad & Tobago based company, annually negotiates a contract with Swiss Watch Company, located in Switzerland, to purchase a large shipment of watches. On July 17, 2015, Valley Harps Ltd purchased 10,000 watches for a total of 1.25 million Swiss francs. However, Valley Harps Ltd is not aware of the exchange rates for Swiss francs, but those of other currencies, including the US dollar.

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
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Question 1
Valley Harps Ltd, a Trinidad & Tobago based company, annually negotiates a contract with Swiss
Watch Company, located in Switzerland, to purchase a large shipment of watches. On July 17, 2015,
Valley Harps Ltd purchased 10,000 watches for a total of 1.25 million Swiss francs. However, Valley
Harps Ltd is not aware of the exchange rates for Swiss francs, but those of other currencies, including
the US dollar.
Selected exchange rates are given as follows:
July 25, 2020
TTD 6.75/USD
USD 0.77/CHF
July 17, 2015
TTD 6.55/USD
USD 0.73/CHF
You are ask to assist Valley Harps Ltd in determining the following:
a) The total cost and cost per watch in Trinidad & Tobago dollars.
b) The total cost and cost per watch in Trinidad & Tobago dollars of 12,000 watches purchased on
July 25, 2020, assuming that Switch Watch Company maintained the same price per watch (in
Swiss francs).
Transcribed Image Text:Question 1 Valley Harps Ltd, a Trinidad & Tobago based company, annually negotiates a contract with Swiss Watch Company, located in Switzerland, to purchase a large shipment of watches. On July 17, 2015, Valley Harps Ltd purchased 10,000 watches for a total of 1.25 million Swiss francs. However, Valley Harps Ltd is not aware of the exchange rates for Swiss francs, but those of other currencies, including the US dollar. Selected exchange rates are given as follows: July 25, 2020 TTD 6.75/USD USD 0.77/CHF July 17, 2015 TTD 6.55/USD USD 0.73/CHF You are ask to assist Valley Harps Ltd in determining the following: a) The total cost and cost per watch in Trinidad & Tobago dollars. b) The total cost and cost per watch in Trinidad & Tobago dollars of 12,000 watches purchased on July 25, 2020, assuming that Switch Watch Company maintained the same price per watch (in Swiss francs).
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