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You have the following information about rates in London for Eurocurrency loans of one-year duration, the exchange rate between the USD and euros, the currency in which you want financing, and the level of financing required:
(a) Discuss the pros and cons of financing in unhedged Eurodollars instead of via Euroeuros. As you do this you must give consideration to the foreign exchange risks associated with financing in Eurodollars.
(b) Provide a simple numerical example demonstrating the potential risk from financing in Eurodollars based on the above information.
in Balance Sheet
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paid installation charges of machinery rs1100
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#question.d.
Consider an economy specified by the following: Y = PE = C + I + G + NX (Income identity) C = 400 + 0.9YD
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