Lorenzo and Neha are partners at a management consulting firm. They are trying to determine which of them has a comparative advantage in creating the 50 slides required for a sales pitch to a prospective client. Lorenzo can create 10 slides per hour. For other activities, he can bill clients $500 per hour. Lorenzo's opportunity cost of creating slides is per slide. Neha's opportunity cost of creating slides is 20% lower than Lorenzo's. However, as the senior partner, her billing rate is 15% higher. Based on all of these facts, has a comparative advantage in creating slides.

The east asiatic company (eac), a danish company with subsidiaries throughout asia, has been funding its bangkok subsidiary primarily with u.s. dollar debt because of the cost and availability of dollar capital as opposed to thai baht-denominated (b) debt. the treasurer of eac-thailand is considering a 1-year bank loan for $247,000.the current spot rate is b32.03 /$, and the dollar-based interest is 6.78% for the 1-year period. 1-year loans are 12.04% in baht.a. assuming expected inflation rates of 4.3 % and 1.24% in thailand and the united states, respectively, for the coming year, according to purchase power parity, what would the effective cost of funds be in thai baht terms? b. if eac's foreign exchange advisers believe strongly that the thai government wants to push the value of the baht down against the dollar by5% over the coming year (to promote its export competitiveness in dollar markets), what might the effective cost of funds end up being in baht terms? c. if eac could borrow thai baht at 13% per annum, would this be cheaper than either part (a) or part (b) above?