Bromance Inc. is a U. S. corporation that has exposure to Japanese yen and British pounds. It has net inflows of ¥5,000,000 and net outflows of £60,000. The present exchange rate of the Japanese yen is $.012 while the present exchange rate of the British pound is $1.50. Bromance Inc. has not hedged its positions. The yen and pound movements against the dollar are highly and positively correlated. If the dollar strengthens, then Bromance Co. will experience which of the following? a. No changes at all because these factors are not relevant. b. A benefit, because the dollar value of its yen position exceeds the dollar value of its pound position. c. Be adversely affected, because the dollar value of its pound position exceeds the dollar value of its yen position. d. Be adversely affected, because the dollar value of its yen position exceeds the dollar value of its pound position. e. A benefit, because the dollar value of its pound position exceeds the dollar value of its yen position.

5. understanding marginal and average tax rates consider the economy of citronia, where citizens consume only oranges. assume that oranges are priced at $1 each. the government has devised the following tax plans: plan a • consumption up to 1,000 oranges is taxed at 50%. • consumption higher than 1,000 oranges is taxed at 20%. plan b • consumption up to 2,000 oranges is taxed at 15%. • consumption higher than 2,000 oranges is taxed at 60%. use the plan a and plan b tax schemes to complete the following table by deriving the marginal and average tax rates under each tax plan at the consumption levels of 300 oranges, 1,200 oranges, and 3,000 oranges, respectively. consumption level plan a plan b (quantity of oranges) marginal tax rate average tax rate marginal tax rate average tax rate (percent) (percent) (percent) (percent) 300 1,200 3,000 complete the following table by indicating whether each plan is a progressive tax system, a proportional tax system, or a regressive tax system. progressive proportional regressive plan a plan b