e are two sources of uncertainty: (i) der. Fill in the following table to illu the following table, Assume that tl
e are two sources of uncertainty: (i) der. Fill in the following table to illu the following table, Assume that tl
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
Related questions
Question
.08 and -.12 are NOT the right answers for the receive order.

Transcribed Image Text:You have bid for a possible export order that would provide a cash inflow of €1 million in 6 months. The spot exchange rate is USD1.31
= EUR1, and the 1-year forward rate is USD1.29 = EUR1. There are two sources of uncertainty: (i) The euro could appreciate or
depreciate, and (i) you may or may not receive the export order. Fill in the following table to illustrate in each case the profits or losses
that you would make if you sell €1 million forward by filling in the following table. Assume that the exchange rate in 1 year will be either
USD1.21 = EUR1 or USD1.41 = EUR1. (Negative values should be indicated by a minus sign. Do not round intermediate calculations.
Enter your answers in millions rounded to 2 decimal places.)
Total Profit/Loss (in millions)
Spot Rate
Receive Order
Lose Order
USD1.21 = EUR1
USD1.41 = EUR1
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