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92.2 The current euro / US dollar exchange rate is €1 : $2. ABC Co, a Eurozone company, makes a $1,000 sale to
a US customer on credit. By the time the customer pays, the Euro has strengthened by 20%.
What will the Euro receipt be?
A €416.67
B €2,400
C €600
D €400If the euro has strengthened, then it will buy more $’s. So the exchange rate becomes 1 euro to $2.4
So the euro receipt will be 1000 / 2.4 = 416.67
(Since you got his question from the BPP Revision Kit, I am surprised you needed to ask which the correct answer is – the Revision Kit must surely have answers at the back?)
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