Question 20 As a currency trader, you see the following quotes on your computer screen Exch. Rate Spot 1-month 2-month 3-month 6-month JPY/USD 98.75/85 12/10 20/16 25/19 45/35 Suppose you want to swap out of JPY 10,000,000 and into USD for 6 months. What are the cash flows associated with the swap? O Receive 101,266$ now and pay 101,523$ in 6 months O Receive 101,163$ now and pay 101,729$ in 6 months O Receive 101.266$ now and pay 101.729$ in 6 months O Receive 101,163$ now and pay 101,523$ in 6 months

Question 20 As a currency trader, you see the following quotes on your computer screen Exch. Rate Spot 1-month 2-month 3-month 6-month JPY/USD 98.75/85 12/10 20/16 25/19 45/35 Suppose you want to swap out of JPY 10,000,000 and into USD for 6 months. What are the cash flows associated with the swap? O Receive 101,266$ now and pay 101,523$ in 6 months O Receive 101,163$ now and pay 101,729$ in 6 months O Receive 101.266$ now and pay 101.729$ in 6 months O Receive 101,163$ now and pay 101,523$ in 6 months

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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30 [Question text] Syarikat Sinergi is considering a new credit policy. The current policy is cash only. The new policy would involve extending credit for one period or net 30. Based on the following information, determine if the switch is advisable. The interest rate is 2.5% per period. CURRENT POLICY NEW POLICY Price per unit RM175 RM175 Cost per unit RM130 RM130 Sales per period in units 1,000 1,100 Select one: A. Yes, the switch should be made because the NPV is RM8,000. B. No, the switch should not be made because the NPV is -RM8,000. C. Yes, the switch should be made because the NPV is RM4,500. D. No, the switch should not be made because the NPV is -RM4,500.
Question 11
Question 1 Consider the option on currency HKD against the USD: Current spot rate is HKD7.50 for 1 USD:· Risk-free HKD rate of interest is 5% p.a.· Risk-free USD rate of interest is 2% p.a.· Volatility (σ) of the currency returns is 20% p.a.· Maturity of the option is 3 months.· Strike rate of the option is HKD8.00 for 1 USD· The currency options are European in nature (a) Draw the terminal payoff diagram for the holder of the currency call option on HKD. (b) Draw the terminal payoff diagram for the holder of the currency put option on USD. (c) How much does it cost to hold (i.e., buy) a call-HKD option? Use the Garman Kohlhagen model. (d) What is the minimum terminal exchange rate for the holder of the call-HKD option to profit fromholding the currency option?…
Problem 11 Intro You have $22,000 to invest. The spot rate for the euro is $1.16 per euro, while the 180-day forward rate is $1.17 per euro. The six-monthly interest rate in the euro area is 6% and in the U.S. it is 3%. Attempt 5/10 for 8 pts. Part 1 What is your risk-free rate of return (yield) from exploiting the higher interest rate in the euro area? Submit
Question 9 Given the cash flows in actual dollars provided in the following table, calculate the present worth value of actual cash flow. Assume that the market interest rate is 16% and the general inflation rate is at 4% each year. n 0 4 5 7 1 pts Cash Flow (in actual dollars) $20,500 $41,500 $36,500 $55,500
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QUESTION THREE A K100, 000 Treasury bill currently sells at 95% of its face value and is 65 days from maturity. Calculate the following for the Treasury bill: the discount yield. the investment yield.
Question 4 Suppose that the current price of USD/TL rate is 7.18. AL Borsa Istanbul there is USD futures contract with maturity June 30th. 2021. Suppose the discount rate fram today to June is 0.95. Suppose that the contractis traded at fair price. Each contract is for 1000 USD and needs 400 TL initial margin and 300 TL maintenance margin in the account. Suppose expecting USD rate will rise you bought 5 long contracts. (Answer the following to 2 decimal digits.) What is the initial price of the future contract - USD/TRY. What is the initial amount of margin account needed- TL If the USD rate falls to 7.14 next month and the discount factor becomes 0.96 what is your profit/loss: TL (write negative number for loss) TL What is the remaining amount on margin account? will there be a margin call? ves/No)
QUESTION 3 (a) KL Co. will be paying USD100,000.00 in 60 days. Assume the following interest rates: U.S. Malaysia 360-day borrowing rate 360-day deposit rate 7% 6% 5% 4% Assume the forward rate of the USD is RM4.20 and the spot rate of the USD is RM4.15. If KL Co. uses a money market hedge, how much will KL Co. be paying in 60 days?

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