Question
A U.S. company has a 6 month accounts receivable equal to AUD 550,000. With the information below, determine the breakeven investment rate between a forward
A U.S. company has a 6 month accounts receivable equal to AUD 550,000. With the information below, determine the breakeven investment rate between a forward & money market hedge. 180day U.S. interest rate = 4% 180day Australian interest rate = 5% 180day forward rate = AUD/$0.93 Spot rate = AUD/$0.92 (e) 180-day spot = AUD/$0.91
a. 7.24% b. 6.14% c. 5.11% d. 2.10% e. 3.20%
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The Smart Investors Survival Guide
Authors: Charles Carlson
1st Edition
0385503873, 978-0385503877
