Your company expects to pay GBP 1,500,000 in 180 days. The 180 day forward rate for GBP is $1.80 and the current spot rate is $1.76. Ifyou use a forward hedge, estimate the cost of hedging the payable if, 90 days later, the spot rate for GBP turns out to be $1.82O $30,000O < $30,000 >O $90,000O < $90,000 >D

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Answered: Your company expects to pay GBP…

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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Consider a 12-month forward contract written on USDTRY. The current spot price is 8.2900 TRY per USD. 12 -month continuously compounded borrowing and lending risk free interest rates are 1.572% and 18.942% per annum for USD and TRY, respectively. What is the correct price of this forward contract at the inception? please answer fast i give upvote
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Heba is expecting to get OMR 50000 at the end of 5 years. How much will be the value today if: Option a: The discount rate is 9.02% half yearly Option b: The discount rate is 12.8% quarterly Select one: a. Option a: 32500.20 Option b: 32000.50 b. Option a: 65000.35 Option b: 49002.45 c. Option a: 32000.25 Option b: 36000.55 d. Option a: 32165.59 Option b: 32009.50
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