1. Your firm wants to convert $1.4 million Australian into U.S. dollars in purchase in 12 months. The spot rate is $0.9704 equals $1 Australian. The inflation rates in Australia and the United States are expected to be 6 percent and 2 percent, respectively. Using the concept of purchasing power parity (PPP) as it relates to future exchange rates, what will be the difference in costs between completing the transaction now and doing it in 12 months?
2. Apogee Widgets, Inc., has filed for Chapter 7 bankruptcy. Assets available to pay off creditors after liquidation totaled $2.1 million. Administrative costs associated with the bankruptcy proceedings amounted to $40,500; wages due to 400 employees were $1 million; unpaid expenses incurred after the bankruptcy filing but before appointment of the trustee were $20,500; property taxes past due were $195,000; and unsecured creditor claims were $1.5 million. In what order and what amount should the proceeds be distributed by the trustee?
3. Helping money flow from individuals who want to improve their financial future to businesses that want to expand the scale or End of exam scope of their operations relies on the successful application of
4. Which of the following is not one of the basic approaches used in monitoring company managers to minimize the impact of the agency problem?
A. Make the managers owners
B. Appoint an ethics specialist to the board of directors
C. Ignore it if the amount of money involved is negligible
D. Monitor managers' actions