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ILLUSTRATIVE QUESTIONS - MANAGING EXPOSURE QUESTION ONE You are given the following information for the spot and one month forward and 3 months forward. spot

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ILLUSTRATIVE QUESTIONS - MANAGING EXPOSURE QUESTION ONE You are given the following information for the spot and one month forward and 3 months forward. spot 1 month forward 3 month forward US (dollars) Canadian (dollar) Netherland (Guilders) 1.5200-1.5210 1.8630-1.8640 4.05 1 - 4.061 4 0.32-0.27 cpm 0.30-0.20 cpm 23 - 17 cpm 8 8 | 10 - 20 cdis 4.4 - 5 5 cdis 8 2-1 1 cpm 0.89-0.84 cpm 0.90-0.80 cpm 6 3 - 6 1 cpm 4 4 45 - 55 cdis 18 3 - 19 3 cdis 8 4 51 - 5 cpm Belgiam (frank) Denmark (kronner) 13.01 - 13.02 Germany (DM) 3.061 - 3.071 REQUIRED Calculate the cost or value in to a customer who wished to a) buy US$ 14,000 one month forward b) buy C$25,000 Spot c) buy BF 75,000 3 months forward d) sell guilders 28,000 1 months forward e) Sell K 20,000 3 months forward f) Sell DM 6,000 1 month forward CONTI

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