The following sales revenue pattern for a British trading concern was cited earlier in the chapter:

Required:
a. Perform a convenience translation into U.S. dollars for each year given the following year-end exchange rates:
2009 ......... £1 = $2.10
2010 ......... £1 = $2.20
2011 ......... £1 = $1.60
b. Compare the year-to-year percentage changes in sales revenues in pounds and in U.S. dollars. Do the two time series move in parallel fashion? Why or why not?
c. Suggest a method for minimizing the effect of exchange rate changes on foreign currency trenddata.

Transcribed Image Text:

2009 2010 2011 Sales revenue £23,500 28,650 £33,160