1. Currently the spot exchange rate is 50 pesos per one dollar. The dollar appreciates by 50% against peso. What is the percent devaluation of peso against the dollar?
2. Currently the spot exchange rate is 50 pesos per one dollar. The analysts are predicting that the peso may devalue by 20%. What is the new peso/$ exchange rate if the said peso devaluation occurs?
3. Managers forgoing a risky, but potentially high value-adding, investment is an example of:
A: Indirect Agency Cost B: Direct Agency Cost C: Non-Cash Expense D: Oversight Mistake