You are a Canadian investor who purchased British securities for 2,000 pounds, one year ago when the British pound cost $1.50.No dividends were paid on the British securities in the past year.Your total return based on Canadian dollars was __________ if the value of the securities is now 2,400 pounds and the pound is worth $1.60.

Question

Quizplus · Accepted Answer

First, we need to calculate the initial investment in Canadian Dollars:

2,000 pounds * $1.50/pound = $3,000

Then, we need to calculate the current value of the investment in Canadian Dollars:

2,400 pounds * $1.60/pound = $3,840

The total return in Canadian Dollars is:

($3,840 - $3,000)/$3,000 = 0.28 or 28.0%

Therefore, the correct answer is C.

You Are a Canadian Investor Who Purchased British Securities for 2,000