Description
In this worksheet, you will calculate the nominal interest rate for two countries, calculate the expected future spot dollar-pound exchange rate between the United States and the United Kingdom, and then answer five short-answer questions in at least 100 words per response.
It is important to understand the differences between nominal and real interest rates because the value of money lent or borrowed is affected by inflation. Your calculations on the spot and forward exchange rates are important as they help manage risks because they allow you to protect costs and profits on products bought and sold internationally. Additionally, since the exchange rates are locked for as long as a year in advance, understanding forward exchange rates will help mitigate risks.
For your assignment:
Complete all parts of the Week 2 Assignment Worksheet and then submit it to Waypoint. The worksheet contains two parts:
a numerical portion consisting of three calculation questions, and
a written portion consisting of five short-answer questions.
Must use the Week 2 Assignment Worksheet.
Must be three to five double-spaced pages in length (not including title and references) and formatted according to APA StyleLinks to an external site. as outlined in the Writing Center’s APA Formatting for Microsoft WordLinks to an external site.
Must document any information used from sources in APA Style as outlined in the Writing Center’s APA: Citing Within Your Paper guide.Links to an external site.
Links to an external site.Must include a separate references page, if sources are used, which is formatted according to APA Style as outlined in the Writing Center. See the APA: Formatting Your References ListLinks to an external site. resource in the Writing Center for specifications.
The Foreign Exchange Rates assignment
