1. Suppose that the exchange rate between the U.S. dollar and the British pound is $1.25/£. Suppose further that the exchange rate between the U.S. dollar and the Euro is $1.10 per Euro. What is the cross-rate between the British pound and the Euro?
€0.880/£
€1.136/£
€1.088/£
€0.962/£
€1.196/£
2. Synergies would LEAST likely cause:
a) an increase in fixed costs
b) an increase in sales
c) an increase in net working capital
d) an increase in variable costs
3. In the constant growth (gordon) model, which of the following represents the capital gain
a. the dividend growth rate, g
b. the dividend just paid, D0
c. the required rate of return, r
d. the required rate of return less the dividend growth rate, r - g
4. Suppose the world demand for copper is about 8,600,000 tons per year. The known global reserves are 308,000,000 tons. What is the static reserve for copper?