2. How would you classify and record each of the following transactions in the Australian balance- of-payments accounts? (Hint: consider the components of the balance of payments accounts) (a) A Japanese insurance company purchases Australian commonwealth bonds and pays out of its bank account maintained in Sydney. (b) An Australian citizen consumes a meal at a restaurant in Paris and pays with her ANZ issued credit card. (c) Indian parents pay for their daughter to study at an Australian university. (d) An Australian university gives a tuition scholarship to a foreign student from Singapore. (e) A Vietnamese immigrant living in Melbourne sends a check drawn on his Commonwealth Bank account in Australia as a gift to his parents living in Hanoi. (15 marks) 3. The following data are taken from the financial market pages of an Australian newspaper. Wholesale Market SPOT RATES Open Close FORWARD MARGINS SA/SUS ............ 0.6943 0.6922 SAV/EUTO........." 0.6189 0.6180 SA .. "Interbank market" wwwwwwwwwww.buy $A/sell $A SAVYen ..... 76.09 75.85 1 month... 0.5378 0.5384 2 months . ... 9/10 SA/Strand.... 0.7080 0.6971 3 months .. ..14/16 SA/SNZ SENSESEE 1.0655 1.0548 4 months .... .... 1921 S/V/SUS range ..... 0.6919/0.6947 5months ... ..2426 Hedge Rate....... 0.6938 ...3031 12 morning. ..57160 CROSS RATES . MAJOR CURRENCIES Against NZD USD Euro Strane Yen 0.6563 0.5087 0.5658 USO.... 0.6510 71.918 1.5236 0.7751 0.8926 1.0073 109.590 csig... 1.9559 1.2902 141.39 Euro 1.7071 1.1203 0.8683 1 1.1516 1.2995 1.1284 122.77 Strand. 1.5128 0.9928 07695 0.9862 We7'000............ 13.905 9.125 7.0728 8.1451 9.191 108.801 The data under the "Forward Margins" column represent the forward contracts for US dollar with respect to the Australian dollar (given in points form). (a) Using this data, and the bid-ask for spot USD at 0.6926 to 0.6928, compute the outright bid/ask rates for the following forward contracts: (i) 1 month (ii) 3 month (iii) 6 month (iv) 12 month (8 marks) (b) Calculate the forward premium for the following contracts: (i) 2 month (ii) 4 month (iii) 5 month (iv) 12 month (8 marks) c) You expect to receive US$ 10,000 in 3 months. What amount will that convert into? (2 marks) d) You need to pay US$ 100,000 in 6 months. How many AUD will you need? (2 marks)