Solution: Use Equation (8-1):
Percentage Change = (0.70 - 0.65)/0.65 = 7.69%
22. What is the percentage depreciation of the US dollar?
* A. -7.14%
B. -6.00%
C. -5.14%
D. -8.88%
E. -9.19*
Solution: Use Equation (8-2):
Percentage Change = (0.65 - 0.70)/0.70 = -7.14%
Use the following information to answer the next three questions.
Suppose that the Swiss franc appreciates from US$0.40 at the beginning of the year to US$0.44 at the end of the year. The US inflation rate is 5 percent and the Swiss inflation rate is 3 percent during the year.
23. What is the percentage appreciation of the Swiss franc?
A. 11.12%
B. 11.00%
* C. 10.00%
D. 10.59%
E. 12.00%
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