Cnooc, a Chinese public-sector company, has made a bid to purchase Unocal, a big U.S. oil...

 

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Cnooc, a Chinese public-sector company, has made a bid to purchase Unocal, a big U.S. oil company, for CNY 18.5 billion in June 2005. Treat this as an initial investment made by Cnooc in this two-year, U.S. based project. If it has purchased Unocal in August 2005, what is the difference in USD Cnooc pays for its initial investment because of the Chinese revaluation of the Yuan from 8.28 Yuan/$ to 8.11 Yuan/$ on July 21, 2005? Cnooc, a Chinese public-sector company, has made a bid to purchase Unocal, a big U.S. oil company, for CNY 18.5 billion in June 2005. Treat this as an initial investment made by Cnooc in this two-year, U.S. based project. If it has purchased Unocal in August 2005, what is the difference in USD Cnooc pays for its initial investment because of the Chinese revaluation of the Yuan from 8.28 Yuan/$ to 8.11 Yuan/$ on July 21, 2005?

Answer rating: 100% (QA)

Absolutely assuming Cnooc pays the entire CNY 185 billion upfront the revaluation of the Yuan would ... View the full answer