he following: Spot USDBRL = 5.0500 1YR USD Money Market Rates = 1.50% 1YR BRL Money Market Rates = 9.00% What is the 1YR USDBRL forward rate? (Recall that Mo
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Assume the following:
Spot USDBRL = 5.0500
1YR USD
1YR BRL Money Market Rates = 9.00%
What is the 1YR USDBRL forward rate? (Recall that Money Market Rates are quoted as annualized rates)
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- Suppose that the 90-day forward rate is $1.17/€, the current spot rate is S1.20/€, and you expect the future spot rate in 90 days to be S1.21/€. If the standard deviation of the 90-day rate of appreciation of the euro relative to the dollar is 2% (in terms of the current spot rate), what range covers 95.46% of your possible profits and losses (assume a normal distribution on the future spot rate)? O a. [-S0.032, SO.112] O b. [-S0.008, S0.0OSS] O . [S0.023, S0.075] O d. [S0.016, S0.064]Calculating Real Rates of Return IfTreasury bills are currently paying 4.7 percent and the inflation rate is 1.9 percent, what is the approximate real rate of interest? The exact real rate?Consider the following money market information being quoted: Which of the following statements is true? Particulars GBP Interest Rate THB Interest Rate Spot Rate 1-year Expected Spot Rate Bid Rate 6.100% 10.550% THB5.6601/GBP THB5.9037/GBP C. Ask Rate 6.125% 10.625% THB5.6622/GBP THB5.9961/GBP a. There is an arbitrage which can only be made by initially borrowing GBP and then investing in THB. b. More than one of the options in this question are correct. The THB is selling at a premium to the GBP in the future. O d. There is an arbitrage which can only be made by initially borrowing THB and then investing in GBP.
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- A. If $1.55 = 1 pound, what is the pound price of dollars? B. If $/pound = 1.6510 and $/Euro = 1.0131, what is pound/Euro? C. If s = $1.5204/pound and f = $1.5210/pound, which currency is at a forward premium? What is the magnitude of the forward premium? What is the magnitude of the forward discount?What exact real rate of return is implied by a nominal return of 6% and an inflation rate of 2.4% over the same time period?(please write answer in a decimal format using 5 decimal places)If Treasury bills are currently paying 3.05 percent and the inflation rate is 1.89 percent, what is the approximate real rate of interest? The exact real rate? Can the calculator and excel solution be provided?
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