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

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

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)