3. Trading in foreign exchange What are spot rates and forward rates? Suppose you open the newspaper today and observe the following indirect exchange rate quotations for the British pound: Forward Exchange Rates 30 Days 60 Days 90 Days 0.5423 0.5439 0.5445 Spot Exchange Rates 0.5401 British pound (pound/dollar) The British pound is selling at a in the forward market. Suppose you make a 550,000 sale to a British customer who has 60 days to pay you in cash. The customer will pay you in British pounds, but your company is based in the United States, so you are most concerned with the dollar value of the payment. If the customer pays you 550,000 today, how much is that worth in dollars? $1,018,330 $865,581 $1,120,163 5967,414 Assume that the forward market correct and the 60-day forward exchange rate quoted in the newspaper today (above) is the spot exchange rate 60 Have the waite the distanlar tarme 3. Trading in foreign exchange What are spot rates and forward rates? Suppose you open the newspaper today and observe the following indirect exchange rate quotations for the British pound: Spot Exchange Rates 0.5401 Forward Exchange Rates 30 Days 60 Days 90 Days 0.5423 0.5439 0.5445 British pound (pound/dollar) The British pound is selling at a in the forward market Suppose you make a ES50,000 discount ish customer who has 60 days to pay you in cash. The customer will pay you in British pounds, but your company is based in the United premium ou are most concerned with the dollar value of the payment. If the customer paye you 550,000 today how much is that worth in dolla $1,018,330 O $865,581 $1,120,163 5967,414 Asume that the forward market is correct and the 60-day forward exchange rate quoted in the newspaper today (above) is the spot exchange rate 60 om now the customers and the best Suppose you make a 550,000 sale to a British customer who has 60 days to pay you in cash. The customer will pay you in British pounds, but your company is based in the United States, no you are most concerned with the dollar value of the payment. If the customer pays you 550,000 today, how much is that worth in dollars? O $1,010,330 $865,581 $1,120,163 $967,414 Assume that the forward market is correct and the 60-day forward exchange rate quoted in the newlipaper today (above) is the spot exchange rate 50 days from now. If the customer waits the full 60 days and pays you 550,000, how much have you lost in dollar terms) due to exchange rate fluctuations? $7,471 $7,115 $6,404 $5,182 Grade It Now Save & Continue