Which of the following correctly matches the PHLX Currency Option Specifications to its Currency Contract Size?   British pound GBP - 10,000 and New Zealand dollar NZD - 100,000   Australian dollar AUD - 100,000 and Japanese yen JPY - 10,000,000   Japanese yen JPY - 1,000,000 and Australian dollar AUD - 10,000   Euro EUR - 10,000 and Swiss franc CHF - 1,000

Q: The exchange rate between the British pound and the Australian dollar (GBP/AUD) is 0.4220, it means…

A: Exchange rate between the British pound and the Australian dollar (GBP/AUD) is 0.4220

Q: the following cross exchange Dinar/ Lira Rupee/Real Bolivar /Shekel

A: In this you have multiply with other currency to get real exchange rate.

Q: Currently, the spot exchange rate is $1.56 per £ and the three-month forward exchange rate is $1.58…

A: The objective of the question is to determine whether the interest rate parity (IRP) is currently…

Q: In alternative universe, the Australian government has decided to enter into a target-zone…

A: Given: 180000 Current rate = 1.5 AUD/$ Central rate = 1.55 AUD/$ Fluctuate 11% ether side.

Q: Suppose Dassie Bank quoted the exchange rate of Singapore dollar in US$ at $0.60, the pound rate in…

A: Currency arbitrage is a strategy that is used by investors to exploit the differences in exchange…

Q: Bid - Ask USD equivalent. Given the table, what are the bid and ask cross-exchange rate for Swiss…

A: The foreign exchange (forex) market is a decentralized global platform where currencies are traded.…

Q: Currently, the spot exchange rate is $1.59 per £ and the three-month forward exchange rate is $1.61…

A: Here,Here,Spot Exchange Rate is $1.59 per £Three Month Forward Exchange Rate is $1.61 per £Three…

Q: a. What is the mid-rate for each maturity? b. What is the annual forward premium for all maturities?…

A: Forward Premium: A forward premium would occur when the expected or forward price of a currency is…

Q: Assume that the one-year interest rate is 3% p.a. in the UK and 2% p.a. in the Euro area. Also,…

A: Step 1: Analyzing the Interest Rate Parity (IRP) TheoryAccording to the IRP theory, the forward…

Q: e one-year forward rate for the Swiss franc is SF1.1505/$. The spot rate is SF1.1626/$. The interest…

A: Based on the interest rate the spot rate and forward rate must be in equilibruim based on the…

Q: Is there any violation of CIP? (b) Calculate the covered margin (going short on the AUD). (c)…

A: Here the spot rate is lower than the forward rate, so the EUR is selling at a premium.  The interest…

Q: Given the following exchange rates in the market, what should be the cross exchange rate between…

A: Cross exchange rate is the rate which is determined between two currencies. Both the currencies are…

Q: What is the contribution to the asset base of the following items under the Basel III requirements?…

A: The underlying assets that would provide value to a firm, investment, or loan are referred to as its…

Q: Currently AUD/USD currency pairs have a quote of 0.7197-99 in Oanda trading platform. If you follow…

A: When there is expectation that prices will go down then there is need to short sell and this gives…

Q: Which statement best describes a financial ratio and financial ratio analysis?     A financial…

A: The statement that best describes a financial ratio and financial ratio analysis is:"A financial…

Q: Use the information below to answer the following questions. CURRENCY PER U.S. U.S. $ EQUIVALENT…

A: As per our guidelines, we are supposed to answer only 3 sub-parts (if there are multiple sub-parts…

Q: Which one of the following best describes an agreement you make today to exchange U.S. dollars for…

A: Hedging is very important techniques to prevent against future losses and there are many ways to…

Q: Assume interest rate parity holds. The one-year risk-free rate in the U.S. is 4.98 percent and the…

A: Forward rate can be calculated as = Spot rate x (1+Foreign Country Interest Rate) / (1+ Domestic…

Q: The following are the foreign currency positions of an FI, expressed in the foreign currency:…

A: The objective of the question is to calculate the net exposure of a financial institution (FI) in…

Q: The euro is quoted as EUR：USD = 1.1420-1.1425，and the Canadian dollar is quoted as USD$：CAD =…

A: Foreign Exchange Rate is the exchange rate at which the currency of one country exchanges with…

Q: Suppose you observe the following spot and forward exchange rates between the U.S. dollar ($) and…

A: Given: U.S. dollar/Canadian dollar = 0.8842 U.S. dollar/Canadian dollar = 0.9001 US interest rate =…

Q: Currently, the spot exchange rate is $0.80/A$ and the one-year forward exchange rate is $0.76/A$.…

A: Here,Spot Exchange Rate is $0.80 per A$One year Forward Exchange Rate is $0.76 per A$One year…

Q: October 30, 2023 November 1, 2023 December 31, 2023 April 30, 2024 Spot Rate $1.130 1.148 1.100…

A: d. $500 net gain

Q: VALUE OF EURO (U.S. dollars per euro) 1.9 1.8 1.7 1.6 1.5 1.4 1.3 1.2 1.1 0 50 100 150 200 250 300…

A: At an exchange rate of 1.5 per euro, the quantity of euros demanded is 300 billion euros, while at…

Q: Using the spot and outright forward quotes in the table below, determine the corresponding bid-ask…

A: Forward Points are computed to add to spot bid-ask to compute the forward exchange rates. These…

Q: Using the currency cross rate table, convert C$300.00 to Japanese yen. Canadian dollar U.S. dollar…

A: Cross rates are the rates when the rates of two currencies are available against the other currency…

Q: If the Australian/US dollar exchange rate is 0.72 USD/AUD, US interest rates are 0.25% and…

A: Given data; Australian /US dollar exchange rate = 0.72 USD/AUD US interest rate = 0.25% Australian…

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.