How much wealthier would you be one year from now if you exchange $100,000 (U.S.) into Hong Kong Dollars today at an indirect rate of HK$7.8/$, earn 7% on your Hong Kong investment, and exchange back at a rate of HK$8.0/$, as compared to investing in the U.S.at 4.0%?
A)$(2,600)
B)$325
C)$2,000
D)$5,744 $100,000 x 7.8 = HK$780,000
HK$780,000 x 1.07 = HK$834,600
HK$834,600/8.0 = $104,325
Compared to: $100,000 x 1.04 = $104,000,

Question

Quizplus · Accepted Answer

After converting back to USD, the investment in Hong Kong yields $104,325, while the U.S. investment yields $104,000. The difference is $325.

How Much Wealthier Would You Be One Year from Now