¥12,500,000. What is Kiko's profit or loss at maturity if the ending spot rates are yen 110 divided by S, yen 115 divided by S, yen 120 divided by S, yen 125 divided by S, yen 130 divided by S, yen 135 divided by S, and yen 140 divided by S.

Q: Nifty currently stand at Rs 8000. A Nifty index future contract with delivery in 146 days sells for…

A: Here we have the spot and futures price along with dividend yield, and we are asked to find the…

Q: st rates in the U.S. andeuro are 4% and 6% respectively and the spot rate for Euro ($/€) is $1.1550,…

A: According to interest rate parity the forward rate and spot exchange rate both should be in…

Q: Candew Corp. buys on 5/20, net 90 days. What is the nominal cost of interest if Candew does not take…

A: Nominal Cost of Interest= (Discount / (1- Discount)) * (360 days/(Full payment days - Discount…

Q: (b)  What is the nominal annual interest rate compounded continu- ously for an annual percentage…

A: In this question we need to compute the nominal annual interest rate compounded continuously for an…

Q: i sold a call option with an exercise price of $1.20/euro. the premium was $0.02/euro. what is my…

A: Buyer of call option will exercise the option if exchange rate is higher than the Exercise price For…

Q: You enter in a long position in a 6x12 FRA at a LIBOR rate of 3.00% and a nominal value of $10M. (a)…

A: Solution:-The scenario in question involves holding a long position in a Forward Rate Agreement…

Q: Chinese RMB is currently priced at $17 per 100 yuan. Assume a continuously compounding interest rate…

A: Forward Price = $15.70 per 100 YuanExplanation:100 Yuan = $1Continuous compounding rate on Dollar =…

Q: 3. The price of a certain item is P1,000, payable in O days but if paid in 30 days there will be a…

A: Formula: Simple Interest = Principle X Rate X Time/365 days

Q: 1. The spot market quotes the exchange rate of the GHS to a CADS as GHS 3.562 while the 90-day…

A: Given Information: Spot market rates GHS3.562 (GHS/CADS) Maturity is 90 days Forward quotes are…

Q: You have account receivables: ₤5 m in one year. o InterestUS: 6.10% per annum & InterestUK: 9% per…

A: In money market hedge, borrow £ for one year such that the maturity value will be equal to £5…

Q: Suppose that S ¥180/S. The annualized risk - free rates are 4.6% and 2.75% in Japan and the U.S.,…

A: Forward rate is that rate of exchange which is determined on the basis of interest rate between two…

Q: The current five‑year Euro yen and Eurodollar rates are 8% and 12.5% per year, respectively. What is…

A: Implied premium = (1+EURO Dollar)5/(1+EURO Yen)5-1

Q: What is the discounted value (present value), and compound discount (interest) of a debt of…

A: Future value is a value received in a future period after adding interest as per the particular…

Q: d. Assume D is $7.90. What will be the new price? Assume Ke is at its original value of 18 percent…

A: To calculate the new price (D2​) using the dividend discount model (DDM), we can use the formula:…

Q: An asset has a current price of ₱80.00 and it has an expected price of ₱95 in 6 months. In your…

A: Value of a contracted asset prior to maturity-It is the value of the asset contacted to trade in the…

Q: According to the latest measures, 1 USD = 147 JPY, 1 EUR = 145.51 JPY, and 1 EUR = 0.95 USD…

A: Given that 1USD = 147 JPY 1 EUR = 0.95 USD 1 EUR = 145.51 JPY The shadow price is here nothing but a…

Q: Refer to the following closing prices of USDTWC and XYZUSD. Compute for the corresponding %MTD…

A: Hi there, Since you have asked multiple question, we will solve the first question for you. If…

Q: What is the maturity value of a $19,426.00 loan borrowed at 3.83% compounded semi- annually for 4…

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Q: What is the present value of $4,450 to be received at the beginning of each of 30 periods,…

A: Present value = Annuity * PVAD of $1

Q: You observe that the current spot price for the Singapore dollar (SGD) is $0.60. What is the…

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Q: P = $809,100; R= 7.09%; n= 360 . Calculate monthly payment

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Q: suppose the rate of $1 for yen is 83 yen, what is 2,5000,000 in dollar

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Q: You have $10,000 to invest for 90 days. Current spot rate: $1.32/₤. The 90-day forward rate is…

A: No arbitrage forward rate is that rate which is lie and agree with interest rate prevailing in the…

Q: A commercial bill with a face value of P100 000 has a current price of P97 711. This bill has 95…

A: Yield=[(face value - current price)/current price ]*360/days of maturity

Q: You purchase a futures contract in euros for $170,000. The trading unit is 125,000 euros. What is…

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Q: A product is to be paid perpetually for P 10,551 at the rate of 1%. How much is the present worth of…

A: Present value of perpetuity is the value of never ending cash flows today. Although the cash flow is…

Q: None

A: Step 1: Identify the current spot rate.Step 2: Calculate the appreciation factor.Step 3: Adjust the…

Q: Suppose that a party wanted to enter an FRA that expires in 121 days and is based on 55-day LIBOR.…

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Q: A leasehold office property is let for 9 years with a profit rent of RM300,000 per annum (gross) for…

A: A leasehold property is one that is leased to the buyer of the property for a predetermined amount…

Q: A 4.375 percent TIPS has an original reference CPI of 179.5. If the current CPI is 205.8, what is…

A: Original CPI reference = 179.50Current CPI = 205.8Interest rate = 4.375%

Q: Part (a): It is said that the Indian who sold Manhattan for $33 was a sharp salesman. If he had put…

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: If EBIT=6,000; interest expense=500, t=30%, and Ks=10%, then the value of S is equal to: a) 60,000…

A: Value of Stock i the Value of common stock is the current market value of the equity share…

Q: i sold a call option with an exercise price of $1.20/euro. the premium was $0.02/euro. what is my…

A: Buyer of Call option will exercise the option if Price is higher than the Exercise Price. For seller…

Q: w

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Q: Forward premium: a) The current price of a pound in Toronto is 1.2345. The 30 days price of the…

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Q: Last month, the value of €1 was $1.30. During the last month the euro (€) depreciated by 5%. What is…

A: The exchange rate refers to the rate at which one currency can be purchased using another specific…

Q: List price is $450.70. The trade discount rate is 31/15/5. What is the single equivalent discount?…

A: The objective of this question is to calculate the single equivalent discount, the trade discount,…

Q: At i = 12%, what is the annual-equivalence amount for the infinite seriesshown next?

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Q: If the foreign interest rate is 4%, the risk premium on domestic assets, ρ, is 18%, and the expected…

A: Covered interest rate parity (CIP) is a financial principle that relates the interest rates and…

Q: A commercial bill with a face value of P100 000 has a current price of P97 711. This bill has 95…

A: Commercial Bill refers to the short-term bill which is the evidence that one person has to make…

Q: The one-year foward rate fof the British pound is qouted at $1.59, and the spot rate of the British…

A: Forward price is the price of exchange which includes the inflation effect of the country. If we add…

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.