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revision mock question ;_;

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › revision mock question ;_;

  • This topic has 1 reply, 2 voices, and was last updated 10 years ago by John Moffat.
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  • May 24, 2015 at 12:33 pm #248399
    fahad
    Member
    • Topics: 24
    • Replies: 114
    • ☆☆

    hello, the current exchange rate for us $ against the pound is us/pound 1.84
    inflation in us is 5 % p.a whereas in uk it is 4%
    exchange rate in 2 years ?

    1.84x 1.05/1.04 = 1.86 right ?

    May 24, 2015 at 5:21 pm #248482
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54705
    • ☆☆☆☆☆

    No!

    1.86 is the forecast exchange rate in 1 years time.

    For a forecast in 2 years time you multiply by another 1.05/1.04

    (I go through exactly the same example in the free lecture!!)

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