In the topic of International Finance, you are required to answer these questions:

(i)

(ii)

(iii)

Additional information for (i)

In the following transactions calculate how much the amount in Sterling: a b. A UK exporter receives a payment from a Dutch customer of 150,000 Kroner. A UK importer buys goods from a Japanese supplier and pays 1 million yen. A UK based company, Lightz Ltd, buys goods from Greenland which cost 100,000 Gretz (the local currency). The goods are resold in the UK for 32,000. At the time of the import purchase, the exchange rate for Gretz against sterling is Gretz3.5650 - 3.800 per . (Note: Ignore bank commission charges) Required: a. Compute the expected profit on the resale. b. Determine the actual profit if the spot rate at the time when the currency is received has moved to: 1. Gretz3.0800 - Gretz3.0950 2. Gretz4.0650 - Gretz4.0800 If a regular pizza hut meal cost RM12.50 in Malaysia and 311.50 in Japan. What is the appropriate purchasing power parity (PPP) rate of exchange for \/RM? In the following transactions calculate how much the amount in Sterling: a. b. A UK exporter receives a payment from a Dutch customer of 150,000 Kroner. A UK importer buys goods from a Japanese supplier and pays 1 million yen. The spot rates are as follows: Bank sells (offer) Danish Kr/ 9.4340 Japan \/ 168.650 Bank buys (bid) 9.5380 170.781