Nanuk is translated under the current rate method, so its translational exposure is its net asset position. The weakening CAD (see Exhibit 2) will generate a re-measurement loss in Sunjet’s other comprehensive income.
It is the net asset position that is exposed to exchange fluctuations under the current rate method. Per Exhibit 2, the CAD is depreciating vs. the USD so would generate a loss. Candidates may think the CAD is strengthening.
Nanuk’s net monetary liability position would generate a re-measurement gain under the temporal method, but it is the net asset position that is exposed to exchange fluctuations under the current rate method.

There is a direct relationship, not an indirect one, between estimated poten- tial GDP growth and credit quality: Higher growth leads to higher quality—that is, an improvement in the likelihood of promised cash flows occurring.
Gillibrand’s statement is accurate. In the long run, the growth rate of GDP dominates. The ratio of earnings to GDP can neither rise nor decline forever, so over the long term it must approximate zero. Similarly, the P/E ratio cannot grow or contract forever, so over the long term it must also approximate zero. Thus, the drivers of potential GDP are ultimately the drivers of stock market performance. Navarro’s statement is accurate. The growth rate of potential GDP is an important determinant of the level of real interest rates, and thus real asset returns in general, in the economy. Faster growth in potential GDP means consumers expect their real income to rise more rapidly. Thus, higher rates of potential GDP growth translate into higher real interest rates and higher expected real asset returns in general.

An HHI greater than 1,800 indicates that an industry is highly concentrated. Should the HHI in a highly concentrated industry change by 50 or more, a governmental challenge to a particular business combination is very likely. In this instance, the industry is highly concentrated and the HHI changes by 90, making Whelan’s second conclusion incorrect. A government challenge is likely.
Whelan’s second conclusion is not correct.
Whelan’s conclusion that the industry is highly concentrated is correct.

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1 Drawbridge sold AUD 5 million forward to the settlement date at an all-in forward price of 0.8940 (USD/AUD).
2 To mark the position to market, Drawbridge offsets the forward transaction by buying AUD 5 million three months forward to the settlement date.
3 For the offsetting forward contract, because the AUD is the base currency in the USD/AUD quote, buying AUD forward means paying the offer for both the spot rate and forward points.
I. The all-in three-month forward rate is calculated as 0.9066 – 0.00364 = 0.90296
II. This gives a net cash flow on settlement day of 5,000,000 × (0.8940 – 0.90296) = –USD44,800 (This is a cash outflow because Drawbridge sold the AUD for- ward and the AUD appreciated against the USD).
4 To determine the mark-to-market value of the original forward position, calculate the present value of the USD cash outflow using the three-month USD discount rate: –USD44,8000/[1 + 0.0023(90/360)] = –USD44,774.
. The present value of the cash flow was not calculated (step 4 of
calculation).
. The cash flow was calculated using the bid rate instead of the offer rate.
1 The all-in three-month forward rate = 0.9062 – 0.00368 = 0.90252
2 This gives a net cash flow on settlement day of 5,000,000 × (0.8940 – 0.90252) = – USD42,600, and the present value is calculated as –USD42,600/[1 + 0.0023(90/360)] = –USD42,576.

. LeCompte provided all the recommended disclosures relating to potential conflicts of interest with respect to UniFlash. In addition to her small equity position in NanoMem and the firm’s market making role for NanoMem shares, LeCompte should have also disclosed the “benefit received” from NanoMem concerning the trip she took as required by Standard 2, Public Appearances. In addition, if news of the secondary offering of NanoMem had already been made public, she should have also disclosed the fact that Topaz had been appointed the lead underwriter.
LeCompte only provided recommended disclosures relating to potential conflicts of interest with respect to UniFlash.