Use the following information to answer Questions 6-8 According to CNBC(28.2.2022 )the Russian ruble was trading as low as 119 per dollar as offshore trading started in the morning during Asia hours, from nearly 84 per dollar the previous close, according to Factset data. It later pared some of its losses, trading at 93 per dollar by 3:30 p.m. in Moscow 6.Calculate by how much did the Russian ruble depreciate in one day?.

Use the following information to answer Questions 6-8 According to CNBC(28.2.2022 )the Russian ruble was trading as low as 119 per dollar as offshore trading started in the morning during Asia hours, from nearly 84 per dollar the previous close, according to Factset data. It later pared some of its losses, trading at 93 per dollar by 3:30 p.m. in Moscow 6.Calculate by how much did the Russian ruble depreciate in one day?.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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KF1. Exquisite Jewelers has purchased 100 pounds of silver from Silver Mines Ltd. at US$8,000 per pound payable in one year. The current spot exchange rate is 1.6295 (C$/US$) and the one year forward rate, quoted by the company’s bank, is 1.6312. The Financial Controller at Fine Jewelers suggests that the spot rate in one year will be 1.6224. Interest rates in Canada are currently 3.9 percent for one year and 3.7 percent in the United States. Required: a) Outline, with calculations, three alternative actions available to Golden Jewelers to handle its foreign exchange exposure. b) Advise the company which alternative they should take, providing the reason for your recommendation
Samuel Samosir works for Peregrine Investments in Jakarta, Indonesia. He focuses his time and attention on the U.S. dollar/Singapore dollar ($/S$) cross-rate. The current spot rate is $1.39/S$. After considerable study, he has concluded that the Singapore dollar will depreciate versus the U.S. dollar in the coming 90 days, probably to about $1.35/S$. He is considering trading options to profit and has the following options on the Singapore dollar to choose from: Option choices on the Singapore dollar: Strike price (US$/Singapore dollar) Premium (US$/Singapore dollar) Call on S$ $1.34 $0.075 Put on S$ $1.37 $0.006 Samuel decides to sell call options in Singapore dollars. What is Samuel's (net) profit/loss (in dollars) per option if the spot rate is $1.56/S$ at maturity?
In a daily meeting, the Chief Financial Officer (CFO) gave Ari the following table of market ratesSpot exchange rate: Yen 106/$U.S. dollar interest rate per annum 10%Japanese Yen interest rate per annum 6%and told Ari that the company’s financial analyst expected the Japanese Yen to depreciate against the U.S. dollar by 3.46% in 90 days. Assume there are 360 days in a year, and all interest rates are simple interest rates. If the financial analyst’s prediction about the US dollar and Japanese Yen turned out to be true: Would Ari make a profit by borrowing 1 million US dollar and investing in the money markets? If yes, how much profit would Ari realize in 90 days?If no, explain why.
Megahurtz International Car Rentals has rent -a-car outlets throughout the world. It keeps funds for transaction purposes in many foreign currencies. Assume that in 200XX it held 100,000 reals in Brazil worth $42,000. It earned. 12 percent interest, but the real declined 20 percent against the dollar. a. What is the value of its holdings, based on Canadian dollars, at year-end? ( Do not round intermediate calculations.) Value of the holdings Sb. What is the value of its holdings, based on Canadian dollars, at year end if it earned 9 percent and the real went up by 10 percent against the dollar? (Do not round intermediate calculations.) Value of the holdings S
cYou observe that the exchange rates for Japanese Yen at Tokyo Bank are given as follows: bid = JY101/$; ask = JY102/$, whereas they are given at New York Bank as: bid = $ 0.0097 Y; ask = $ 0.0098y. J J Calculate the arbitrage profit for $1 million (up to nearest cents, e.g., 100.23)
Samuel Samosir works for Peregrine Investments in Jakarta, Indonesia. He focuses his time and attention on the U.S. dollar/Singapore dollar ($/S$) cross-rate. The current spot rate is $1.39/S$. After considerable study, he has concluded that the Singapore dollar will depreciate versus the U.S. dollar in the coming 90 days, probably to about $1.35/S$. He is considering trading options to profit and has the following options on the Singapore dollar to choose from: Option choices on the Singapore dollar: Call on S$ Put on S$ Strike price (US$/Singapore dollar) $1.50 $1.37 Premium (US$/Singapore dollar) $0.064 $0.006 Samuel decides to sell call options in Singapore dollars. What is Samuel's (net) profit/loss (in dollars) per option if the spot rate is $1.54/S$ at maturity?
In Jan 2003, the interest rate on the Japanese Yen was 1.91%, and on the Australian dollar was 5.86%. The spot rate was S(V/AU$)-75.49. Tom Bohn, a hedge fund trader specializing in FX trading in Blackrock Inc, started a carry trade between Yen and Australia for one year. Then the carry (interest rate differential) between Yen and AU$ was % (Two decimal places in your answer.