Question

Assume that Nevermore, Inc., a U.S.-based subsidiary wants to raise $US 1 million by issuing a bond denominated in Pakistani rupees (PKR). The current exchange rate of the rupee is $.02

How many PKR does the MNC need to obtain the $US 1 million needed?

Answer 1

Nevermore, Inc. needs to issue a bond for 50 million PKR to raise an equivalent of $US 1 million at the given exchange rate of $0.02 per PKR.

Step-by-step explanation:

To determine how many Pakistani rupees (PKR) Nevermore, Inc. needs to obtain the $US 1 million needed, we can use the current exchange rate provided in the question, which is $0.02 per PKR. Thus, we will perform the following calculation:

$1,000,000 / $0.02 =
50,000,000 PKR

Therefore, Nevermore, Inc. needs to issue a bond for 50 million PKR to raise the equivalent of $US 1 million.

Answer 2

Answer: 50,000,000 Pakistani rupees (PKR)

Step-by-step explanation:

The company wants to raise enough money in Pakistani rupees to match a million American dollars.

The rate is a Rupee to $0.02.

A million dollars will be:

= 1,000,000/0.02

= 50,000,000 Pakistani rupees (PKR)