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Assume the following spot and forward rates for the Singapore dollar to Ringgit Malaysia (SGD/RM): Required: (a) Suppose you take up a 120-day forward contract

Assume the following spot and forward rates for the Singapore dollar to Ringgit Malaysia (SGD/RM): Required: (a) Suppose you take up a 120-day forward contract to exchange 870,000 Singapore Dollars into Ringgit Malaysia. How many Ringgit Malaysia will you receive? (2 marks) (b) Compute the 90-day forward premium; (4 marks) (c) Compute the 120-day forward premium; (4 marks) (d) Critically discuss the differences between a currency options and currency futures contract. (10 marks) [Total: 20 marks]

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