A large Australian company wishes to raise short-term capital and decides to do so in the...
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A large Australian company wishes to raise short-term capital and decides to do so in the US short-term money market (STMM) because interest rates in the US are lower than in Australia. It issues a 90-day USD $1,000,000 FV Corporate Note which is promptly bought by a US investor. The Australian company decides not to re-finance the Note and will have a USD $1,000,000 liability pay in 90 days using it's AUD earnings. Which of the following currency movements is not beneficial to the Australian company? (select multiple answers if correct) Select one or more: a. AUD falls aginst the USD b. USD appreciates against the AUD c. USD falls against the AUD d. AUD appreciates against the USD A large Australian company wishes to raise short-term capital and decides to do so in the US short-term money market (STMM) because interest rates in the US are lower than in Australia. It issues a 90-day USD $1,000,000 FV Corporate Note which is promptly bought by a US investor. The Australian company decides not to re-finance the Note and will have a USD $1,000,000 liability pay in 90 days using it's AUD earnings. Which of the following currency movements is not beneficial to the Australian company? (select multiple answers if correct) Select one or more: a. AUD falls aginst the USD b. USD appreciates against the AUD c. USD falls against the AUD d. AUD appreciates against the USD
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Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
Posted Date:
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