Take the exchange rates of two different nations at two different time intervals and determine the...

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Accounting

Take the exchange rates of two different nations at twodifferent time intervals and determine the DER and IER withreference to one country.
Discuss the impact on import due to changes in the exchangerate upon any one nation.
Also discuss the impact on export due to change in the exchangerate upon the same nation.
Discuss the strength or weakness of one currency over theperiod of time with reference to other currency.

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3.6 Ratings (426 Votes)

We are taking US as the local currency and EURO as the Foriegn Currency and the exchange rates for the period 01012019 to 31122019 in thia pronlem Solution DERDirect Exchange rate American term identifies a local currency Further it represents the number of Local currency unitsLCU to be needed to obtain one Foriegn Currency UnitFCU DER USLCU 1 EURO FCU IER Indirect exchange rate a term which used to identify the number of units of Foriegn Currency required to obtain one unit of LCU It is resiprocal to DER and is in the view of Foriegn entity IER 1FCU LCU equalent On 01012019 See Answer

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