CIMA Exam CIMAPRA19-F03-1 Topic 5 Question 65 Discussion

Actual exam question for CIMA's CIMAPRA19-F03-1 exam

Question #: 65
Topic #: 5

Companies L. M N and O:

* are based in a country that uses the RS as its currency

* have an objective to grow operating profit year on year

* have the same total levels of revenue and cost

* trade with companies or individuals in the United States. All import and export trade with companies or individuals in the United States is priced in US$.

Typical import/export trade for each company in a year are as follows:

Which company's growth objective is most sensitive to a movement in the USS / RS exchange rate?

ACompany L

BCompany M

CCompany N

DCompany O

Show Suggested Answer

Suggested Answer: A, B, E

by Leota at Feb 27, 2023, 01:05 AM

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Katlyn

4 days ago

The answer is clearly D. Company O has the most trade in USD, so their profits will be the most affected by changes in the exchange rate.

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Roslyn

7 days ago

C'mon, it's pretty obvious that Company O is the one to watch here. Their numbers show they're the most exposed to the USD/RS exchange rate.

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Erinn

19 days ago

Haha, I bet Company O's accountant is sweating bullets every time the exchange rate fluctuates. Gotta love those global trade challenges!

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Vicente

7 days ago

Company O's growth objective is definitely the most sensitive to exchange rate movements.

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Lenita

23 days ago

But Company O also has a significant amount of trade with the United States. It could also be sensitive to the exchange rate.

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Leana

24 days ago

I agree with you, Kara. Company M has the highest proportion of import and export trade with the United States.

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Timmy

28 days ago

Company O's growth objective is the most sensitive to the USD/RS exchange rate movement. They have the highest proportion of exports and imports in USD compared to the other companies.

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Salina

10 days ago

Company O is definitely the most affected by exchange rate movements.

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Kara

1 months ago

I think Company M's growth objective is most sensitive to the exchange rate.

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