15 Suppose that the current exchange rate is 1.00 - $1.60. The indirect quote from the US. perspective is A) 0.6250 - $1.00 3) 1.50 - $1.00 1.00 - $1.60 Dy none of the options 19) The bid price A) is the price that a dealer stands ready to pay B) is the price that a dealer stands ready to sell at. is the price that the dealer has just paid for something, his historical cost of the most recent trade. D) refers only to auctions like eBay, not over-the-counter transactions with dealers. 20) 20. If the Se bid and ask prices are $1.50 and $1.51/, respectively, the corresponding ES bid and ask prices are A) $1.51 and $1.50 B) 0.6667 and 0.6623. 0.6623 and 0.6667 D) cannot be determined with the information given Country US Seguir. Currency per USS Tuesday Monday Tuesday Monday 2.0000198000 Britain (Pound) 162500 3000 0 SOST Month Forward 201009000.49750503 Maths onward 202002.00000.4950 05000 6 Months Forward 201100 0 100 074975 Months Forward 20400 2 20200 0.4902 0950 TE SO0 15000 1.450006667 0.6757 Month Forward 13100 1.4900 0 66223 0.6711 Months Forward 132001 S000076579 076667 6 Months Forward 15300 13100 0 6536 0.6623 12 Months Forward 13400 1200 0 7604 0.6579 Using the table shown, what is the spot cross-exchange rate between pounds and curo? A 1.00 - 0.75 B) 1.00 - 0.75 133 1.00 Dy none of the options Suppose you observe the following exchange rates: El - $1.50; 120 - $1.00. Calculate the curyen exchange rate. A -E1.00 B) 133.33 - 1.00 GET=2.50 D) V1.00 - 180 22) Country Switzerland (Franc) CHF Euro USD equivalent BID ASK 0.7648 0.7652 1.4000 1.4200 What is the ASK cross-exchange rate for Swiss Francs priced in euro? Hint: Find the price that a currency dealer will take in euro to sell Swiss francs. A) 0.5386/CHF B) 0.5466/CHF 0.5389/CHF D) 0.5463/CHF 24) 24) Suppose a bank customer with 1,000,000 wishes to trade out of euro and into Japanese yen. The dollar-euro exchange rate is quoted as $1.70 - 1.00 and the dollar-yen exchange rate is quoted at $1.00 Y130. How many yen will the customer get? A) V5,208.33 B) V75,000,000 45,208,333 D) Y221,000,000 25) 25) You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-curo exchange rate is quoted as $1.20 - 1.00 and the dollar-pound exchange rate is quoted at $1.80 = 1.00. If a bank quotes you a cross rate of 1.00 - 1.50, how much money can an astute trader make A) $500,000 B) $250,000 No arbitrage is possible D) $1,160,000 26) 26) Suppose you observe the following exchange rates: 1 - $.85; 1 - $1.60; and 2.00 = 1.00. Starting with $1,000,000, how can you make money? A) Exchange Sim for 625,000 at ! - $1.60. Buy 1,250,000 at 2 - 1.00; trade for $1,062,500 at 1 - 5.85. B) Start with euros; exchange for pounds, exchange for dollars, exchange for euros. Start with dollars, exchange for euros at E1-5.85; exchange for pounds at 2.00 - 1.00; exchange for dollars at l - $1.60. 27) 27) You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-euro exchange rate is quoted as $1.50 = 1.00 and the dollar-pound exchange rate is quoted at $2.00 = 1.00. If a bank quotes you a cross rate of 1.00 - 1.25 how can you make money? A) Buy euro at $1.50/e, buy at 1.25/, sell at $2/. B) No arbitrage is possible. Buy $2/, buy at 1.25/, sell at $1.50/e