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Financial Strategy

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Financial Strategy Questions and Answers

Questions 1

Companies L. M N and O:

• are based in a country that uses the RS as its currency

• have an objective to grow operating profit year on year

• have the same total levels of revenue and cost

• trade with companies or individuals in the United States. All import and export trade with companies or individuals in the United States is priced in US$.

Typical import/export trade for each company in a year are as follows:

Questions 1

Which company's growth objective is most sensitive to a movement in the USS / RS exchange rate?

Options:

A.  

Company L

B.  

Company M

C.  

Company N

D.  

Company O

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