Suppose a U.S. firm purchases some Chinese handicrafts. The china costs 1,000 Chinese yuan. At the exchange rate of $1.00 = 6.2 yuan, the dollar price of the goods is:

Q: The exchange rate is 113 Swiss francs per dollar. How many U.S. dollars are needed to purchase 2,500…

A: In the given case, we have provided the exchange rate of per dollar into swiss francs.And, we have…

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Q: XYZ Corporation imports goods from China with a total invoice value of $10,000,000. The exchange…

A: Foreign exchange rates represent the relative value of one currency in terms of the another. These…

Q: A U.S. firm buys merchandise from a Portuguese company at a cost of EUR 250,000.  The merchandise…

A: The United State firm is exposed to foreign exchange fluctuation because it will pay in dollars in…

Q: The most recent currency exchange rate between the British Pound (GBP) and the US Dollar (US) is…

A: The question is based on the concept of Foreign Exchange Management.The forex market enables…

Q: Required: State what are the presumed advantages of using forward exchange contracts.  Calculate…

A: Data given::> Invoice amount = $130,000 Payment details: On shipment = $40,000 One month after…

Q: ARP/USD .0072 in nominal currency exchange rate terms. I can purchase a Dell laptop for $1,100 in…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Suppose that Retrojo Inc. is a U.S. based MNC that will need to purchase F$1.10 million (Fijian…

A: USD needed at depreciated rate= $462,000.00Explanation:Retrojo Inc. would need $462,000.00 (US…

Q: In Sweden, the exchange rate of the Norwegian krone is 0.95. The exchange rate of the Polish…

A: Arbitrage opportunity is the risk free opportunity available for short period due to mispricing in…

Q: er annum in the U.S. and 5.7% per annum in the U.K. Assume that you can borrow £1,000,000 or its…

A: In monetary terms, the exchange rate (also known as the foreign exchange rate, forex rate, or rate)…

Q: our firm is a U.S.-based supplier of agricultural parts. A European customer just made a €50,000…

A: Calculate the value of accounts receivable on the date of the sale, using the exchange rate at the…

Q: Suppose you exported something from Mexico to the US and were quoted a price (payable immediately)…

A: Export: A product or service that is manufactured in one nation but sold to a buyer in another…

Q: Suppose that the current exchange rate is €0.70 = $1.00. The direct quote, from the U.S. perspective…

A: Exchange rate is €0.70 = $1.00The current exchange rate refers to the current value of one currency…

Q: Suppose that the current spot exchange rate is €0.80/$ and the three-month forward exchange rate is…

A: Arbitrage profit Arbitrage is an investment strategy used by investors that involves buying and…

Q: Which of the following represents the time value of money concept? a) Money today is worth more than…

A: Explanation of Time Value of Money:The time value of money (TVM) is a financial concept that…

Q: Suppose that the Canadian dollar is worth A$1.08 and the United States dollar is worth A$1.35. (a)…

A:

Q: 1. What is the price of 1 US dollar in terms of each of the following currencies, given the…

A: Exchange rate is that rate at which currencies of two countries can be exchanged with each other.

Q: Suppose you, a German importer, expect to pay $1 million in 90 days for taking delivery of import…

A:

Q: A telephone costs $50 in the United States.  Today, in the currency markets you observe the…

A: Based on the information given in the above question we need to convert the price of telephone in…

Q: Using the cost and revenue information shown for Dekalb, Inc., determine how the costs, revenue, and…

A: cash flowThe cash received and paid for the operative and day-to-day activities of the company is…

Q: An investor in the US can invest in the US, and earn an interest rate of 5.55%, or invest in Jápan…

A: Answer: Calculation of the value of the Et: Formula,  Forward rate = Spot rate x [(1+ Interest rate…

Q: If the current USDJPY exchange rate is 135.00 Japanese yen per U.S. dollar, the price of a Big Mac…

A: The law of one price is a concept which will advocate for uniform price across different nation for…

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A: JPY to be exchanged = 50,000,000 JPYCurrent exchange rate : 1 JPY = 0.0082 USDCurrency exchange fee…

Q: A computer costs $500 in the United States. The same model costs €550 inFrance. If purchasing power…

A:

Q: Sing Tao wants to import goods for 2.12 million Australian dollar (A$) and pay to Australian…

A: Money market hedging is a financial strategy used by individuals, businesses, and investors to…

Q: Blur Ltd, a UK importer, expects to make a payment of 1.8m Australian dollars (A$) for sure in one…

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Q: Suppose that a US-based company is buying Chinese goods. Current exchange rate for Chinese Yuan is…

A: Given that the company is purchasing 800 units. Price of one unit = 13000¥ Current exchange rate =…

Q: Suppose your company imports computer motherboards from Singapore. The exchange rate is $1.4878 per…

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Q: Problem: 1. The exchange rates is 8 rubles per dollar. The Russian price level is 200. The price…

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Q: A computer costs $600 in the United States. The same model costs €555 in France. If purchasing power…

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Q: A television costs $710 in the United States. The same television costs 628.5 euros. If purchasing…

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A: Bid price refers to the price at which the forex trader buys the foreign currency while Ask price…

Q: Suppose your company imports computer motherboards from Singapore. The exchange rate is $1.4353 per…

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A: Here, Bid RateAsk RateValue of Chinese Yuan (CNY) in Australian Dollar (AUD)0.20460.2243Value of…

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Q: What is your profit from exploiting the opportunity once (in $)?

A: Exchange rateBidAskValue of yen in U.S. dollars$0.008$0.0081Value of Canadian dollar in U.S.…

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Q: Suppose that Cloudastries Bank is a U.S.-based financial intermediary that serves the foreign…

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Q: Suppose an American Investor is given the current exchange rates in the following table. The listed…

A: Direct exchange rates refer to 1 unit of the foreign or host currency quoted in terms of the…

Q: months' time. The U.S. interest rate is 2% p.a., and the Swiss interest rate Assume that the current…

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Instruments of Foreign Exchange Market

Foreign exchange is a worldwide market in which one nation’s currency is converted into another nation’s currency. In further terms, exchanging of nations currency with foreign currencies. Foreign exchange happens at a specified rate which is termed the foreign exchange rate. The exchange rates are not constant continuously changing as they are derived by market forces of supply and demand. Widely used foreign currencies are the United States- dollar, Euro, Japanese Yen, British pound, and Australian dollar. US- dollar is the most denominated foreign currency. The Euro to US dollar is a widely used currency pair in the forex market as these two currencies represent the world’s enormous economy. Forex trade is simple as exchanging currencies at the bank. The main players of forex markets are the central banks, financial institutions, intermediaries, investments banks, and other banks. Central Bank is the supreme player who decides the currency value of their own nation on the forex market. Mostly foreign exchange-traded at FX market (forex market) when tourists’ visits a foreign country, import, and export happens between two countries.