Three years ago, the u. s. dollar/euro exchange was 1.32 usd/eur. over the last three years, the price level in the united states has increased by 18%, and the price level in the eurozone has increased by 12%. if the current exchange rate is 1.40 usd/eur, the real rate over the period has: a. increased, and eurozone goods are now more expensive to u. s. customers. b. decrease, and eurozone goods are now more expensive to u. s. customers. c. increases, and u. s. goods are now more expensive to eurozone customers.

Which of the following statements is correct? stockholders should generally be happier than bondholders to have managers invest in risky projects with high potential returns as opposed to safe projects with lower expected returns. potential conflicts between stockholders and bondholders are increased if a firm's bonds are convertible into its common stock. takeovers are most likely to be attempted if the target firm’s stock price is above its intrinsic value. one advantage of operating a business as a corporation is that stockholders can deduct their pro rata share of the taxes the firm pays, thereby eliminating the double taxation investors would face in a partnership.