Canadian Denmark Euro S per Foreign Currency $.7800 $.2000 $.9900 Foreign Currency per 1.2821 5.0000 1.0101 a. How many Canadian dollars would you receive for $500? b. A Mercedes costs Euros 130,000. How many $ would you need?
Canadian Denmark Euro S per Foreign Currency $.7800 $.2000 $.9900 Foreign Currency per 1.2821 5.0000 1.0101 a. How many Canadian dollars would you receive for $500? b. A Mercedes costs Euros 130,000. How many $ would you need?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:d. If the risk free rate in Canada is 5% and the risk free rate in the USA is 6%, would
the Canadian $ 6 month forward exchange rate be selling at a discount or premium
exchange rate?
e. If the direct spot rate for the Canadian dollar is $.90. What should the 1 year forward
rate be?

Transcribed Image Text:Canadian
Denmark
Euro
S per Foreign Currency
$.7800
$.2000
$.9900
Foreign Currency per $
1.2821
5.0000
1.0101
a. How many Canadian dollars would you receive for $500?
b. A Mercedes costs Euros 130,000. How many $ would you need?
c. What is the cross rate of Canadian $ and Denmark?
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