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7 In Japan, Honda's export price is Yen 3 million. Spot rate is Y 100/5, Suppose suddenly the rate changes to Y90/S. Assuming 60 % exchange rate pass-thru, what should be the price of Honda in U.S. in S (rounded)? $33,000 a. b. $33.333 $31,999 $31,333 need more information c. d. . 8 If inflation in U.S. is projected at 3% annually for the next year and at 8% annually in Mexico for the same time period, and the spot rate is currently at 10.20 pesos/S, then the purchasing power parity estimate for the spot rate one year from now is: (rounded): Pesos 10.695/s a. b. Pesos 10.4512/S Pesos 9.7278/S Pesos 9.9548/S . d. A U.S. firm has sold an Italian firm E1,000,000 worth of product. In one year the U.S. firm gets paid in euros. To hedge, the U.S. firm bought an options on the euro with a strike price of Si.65. They paid an option premium S0.01 per euro. If at maturity, the exchange rate is $1.60, the firm will realize S1,645,000 on the sale net of the cost of hedging. the firm will realize $1,650,000 on the sale net of the cost of hedging. the firm will realize $1,640,000 on the sale net of the cost of hedging. none of the options 9. a. b. . d. A U.S. firm can hedge its accounts payables in Brazilian real against appreciation by: selling Brazilian real futures buying Brazilian real futures buying Brazilian real puts selling Brazilian real in the forward market 10. a. b. . d. If you believe the Brazilian real will fall from the present spot rate of S0.5555 / Brazilian real, which speculative strategy would yield the largest speculative gain? sell futures on Brazilian real buy futures on Brazilian real 11. a. buy call options on the Brazilian real . d. none of the above A specutator in options that has position in Japanese yen. purchased; bullish purchased; bearish sold; bearish need more information to answer the question a put option on Japanese yen has taken a 12 a. b. . d. A firm with fixed-rate debt that expects interest rates to increase may engage in a swap 13. agreement to pay fixed-rate interest and receive floating rate interest. pay floating rate and receive fixed rate. pay floating rate and receive floating rate pay fixed rate and receive return on S&P500 index a. b. . d. 7. In Japan, Honda's export price is Yen 3 million. Spot rate is E 100/5, Suppose suddenly the rate changes to 190/S. Assuming 60 % exchange rate pass-thru, what should be the price of Honda in U.S. in S (rounded)? $33,000 $33.333 $31,999 $31,333 need more information a. b. . d. C. 8. If inflation in U.S. is projected at 3% annually for the next year and at 8% annually in Mexico for the same time period, and the spot rate is currently at 10.20 pesos/S, then the purchasing power parity estimate for the spot rate one year from now is: (rounded): Pesos 10.695/S Pesos 10.4512/S Pesos 9.7278/S Pesos 9.9548/S . b. . d. 9. A U.S. firm has sold an Italian firm E1.000,000 worth of product. In one year the U.S. firm gets paid in euros. To hedge, the U.S. firm bought an options on the euro with a strike price of S1.65. They paid an option premium $0.01 per euro. If at maturity, the exchange rate is $1.60, the firm will realize $1,645,000 on the sale net of the cost of hedging. the firm will realize $1,650,000 on the sale et of the cost of hedging the firm will realize $1.640,000 on the sale net of the cost of hedging. none of the options a. b. . d. A U.S. firm can hedge its accounts payables in Brazilian real against appreciation by: selling Brazilian real futures buying Brazilian real futures buying Brazilian real puts selling Brazilian real in the forward market 10. . b. c. d. If you believe the Brazilian real will fall from the present spot rate of S0.5555/Brazilian real, which speculative strategy would yield the largest speculative gain? sell futures on Brazilian real buy futures on Brazilian real buy call options on the Brazilian real none of the above 1. a. b. C. d. A speculator in options that has position in Japanese yen. purchased; bullish purchased; bearish sold; bearish need more information to answer the question 12. a put option on Japanese yen has taken a a. b. C. d. A firm with fixed-rate debt that expects interest rates to increase may engage in a swap 13. agreement to pay fixed-rate interest and receive floating rate interest. a. pay floating rate and receive fixed rate. pay floating rate and receive floating rate. pay fixed rate and receive return on S&P500 index b. . 7 In Japan, Honda's export price is Yen 3 million. Spot rate is Y 100/5, Suppose suddenly the rate changes to Y90/S. Assuming 60 % exchange rate pass-thru, what should be the price of Honda in U.S. in S (rounded)? $33,000 a. b. $33.333 $31,999 $31,333 need more information c. d. . 8 If inflation in U.S. is projected at 3% annually for the next year and at 8% annually in Mexico for the same time period, and the spot rate is currently at 10.20 pesos/S, then the purchasing power parity estimate for the spot rate one year from now is: (rounded): Pesos 10.695/s a. b. Pesos 10.4512/S Pesos 9.7278/S Pesos 9.9548/S . d. A U.S. firm has sold an Italian firm E1,000,000 worth of product. In one year the U.S. firm gets paid in euros. To hedge, the U.S. firm bought an options on the euro with a strike price of Si.65. They paid an option premium S0.01 per euro. If at maturity, the exchange rate is $1.60, the firm will realize S1,645,000 on the sale net of the cost of hedging. the firm will realize $1,650,000 on the sale net of the cost of hedging. the firm will realize $1,640,000 on the sale net of the cost of hedging. none of the options 9. a. b. . d. A U.S. firm can hedge its accounts payables in Brazilian real against appreciation by: selling Brazilian real futures buying Brazilian real futures buying Brazilian real puts selling Brazilian real in the forward market 10. a. b. . d. If you believe the Brazilian real will fall from the present spot rate of S0.5555 / Brazilian real, which speculative strategy would yield the largest speculative gain? sell futures on Brazilian real buy futures on Brazilian real 11. a. buy call options on the Brazilian real . d. none of the above A specutator in options that has position in Japanese yen. purchased; bullish purchased; bearish sold; bearish need more information to answer the question a put option on Japanese yen has taken a 12 a. b. . d. A firm with fixed-rate debt that expects interest rates to increase may engage in a swap 13. agreement to pay fixed-rate interest and receive floating rate interest. pay floating rate and receive fixed rate. pay floating rate and receive floating rate pay fixed rate and receive return on S&P500 index a. b. . d. 7. In Japan, Honda's export price is Yen 3 million. Spot rate is E 100/5, Suppose suddenly the rate changes to 190/S. Assuming 60 % exchange rate pass-thru, what should be the price of Honda in U.S. in S (rounded)? $33,000 $33.333 $31,999 $31,333 need more information a. b. . d. C. 8. If inflation in U.S. is projected at 3% annually for the next year and at 8% annually in Mexico for the same time period, and the spot rate is currently at 10.20 pesos/S, then the purchasing power parity estimate for the spot rate one year from now is: (rounded): Pesos 10.695/S Pesos 10.4512/S Pesos 9.7278/S Pesos 9.9548/S . b. . d. 9. A U.S. firm has sold an Italian firm E1.000,000 worth of product. In one year the U.S. firm gets paid in euros. To hedge, the U.S. firm bought an options on the euro with a strike price of S1.65. They paid an option premium $0.01 per euro. If at maturity, the exchange rate is $1.60, the firm will realize $1,645,000 on the sale net of the cost of hedging. the firm will realize $1,650,000 on the sale et of the cost of hedging the firm will realize $1.640,000 on the sale net of the cost of hedging. none of the options a. b. . d. A U.S. firm can hedge its accounts payables in Brazilian real against appreciation by: selling Brazilian real futures buying Brazilian real futures buying Brazilian real puts selling Brazilian real in the forward market 10. . b. c. d. If you believe the Brazilian real will fall from the present spot rate of S0.5555/Brazilian real, which speculative strategy would yield the largest speculative gain? sell futures on Brazilian real buy futures on Brazilian real buy call options on the Brazilian real none of the above 1. a. b. C. d. A speculator in options that has position in Japanese yen. purchased; bullish purchased; bearish sold; bearish need more information to answer the question 12. a put option on Japanese yen has taken a a. b. C. d. A firm with fixed-rate debt that expects interest rates to increase may engage in a swap 13. agreement to pay fixed-rate interest and receive floating rate interest. a. pay floating rate and receive fixed rate. pay floating rate and receive floating rate. pay fixed rate and receive return on S&P500 index b