Calculate the per annum premium (discount) of a 3-month forward

contract on Canadian dollars based on the information in Figure 4.1.

2) Use figure 4.1 to determine whether each of the currencies listed here is selling at 3 month forward premium or discouny against the dollar

a) Pound

b) Swiss Franc

c) Yen

4) Canadian Dollar

One-year Country Closing mid-point 3-month forward spot rate forward 4.5703 Argentina (Peso) 4.0813 4.1048 1.0276 Australia (Australian $) 0.9289 1.0721 1.6861 Brazil (Real) 1.5640 1.5696 Canada (Canadian $) 0.9625 0.9515 0.9492 India (Rupee) 47.7050 44.5150 44.8063 Indonesia (Rupiah) 8650.0000 8698.5000 9205.0000 Japan (Yen) 81.7050 81.6951 81.3689 Sweden (Krona) 6.0988 6.1096 6.2469 Switzerland (Franc) 0.8795 0.8793 0.8784 U.K. (Pound) 1.6450 1.6443 1.6345 Euro (Euro) 1.4626 1.4613 1.4452 Figure 4.1 Selected currency trading exchange rates. Source: Table is based on data from Financial Times, "Currency Markets: Dollar Spot Forward Against the Dollar and Dollar Against Other Currencies" on April 26, 2011. See: http://markets.ft.com/RESEARCH/ markets