Please answer the following Question as SOON as Possible:
Forward Exchange Rates [LO1] Use the information in Figure 21.1 to answer the following questions: a. What is the six-month forward rate for the Japanese yen in yen per U.S. dollar? Is the yen selling at a premium or a discount? Explain. b. What is the three-month forward rate for Australian dollars in U.S. dollars per Australian dollar? Is the dollar selling at a premium or a discount? Explain. c. What do you think will happen to the value of the dollar relative to the yen and the Australian dollar, based on the information in the figure? Explain. FIGURE 21.1 Exchange Rate Quotations Currencies U.S.-dollar foreign-exchange rates in late New York trading US$ vs, -Thurs- YTD chg in US$ per US$ (%) Country/currency in US$ per US$ (%) Americas .05050 Country/currency Europe Czech Rep. koruna Denmark krone Euro area euro 19.800 -0.4 1858 Argentina peso Brazil real Canada dollar Chile peso Colombia peso 5.3816 -0.8 1250 8.0001 22.7 4476 2.2339 -5.4 .9126 1.0958 3.2 .001773 1.3869 7210 -0.9 .004524 221.06 2.2 .0005169 5.9433 -2.1 1683 .3306 3.0246 Ecuador US dollor 1 0.1 Mexico peso 0767 564.00 7.3 1934.50 0.2 1 unch 13.0434 unch 2.808 0.2 7.8 6.3500 unch Hungary forint Norway krone Poland zloty Russia ruble Sweden krona Switzerland franc 1-mos forward .02807 35.620 8.2 Peru new sol 1537 6.5068 1.1 .3561 04379 22.8355 1.1373 .8793 -1.5 Uruguay peso Venezuela b. fuerte 157480 1.1376 .8791 -1.6 3-mos forward 1.1381 .8786 -1.6 Asia-Pacific 1.1391 .8779 -1.6 Australian dollar .9274 .4749 2.1057 -2.0 1.0783 -3.9 1.0805 -4.0 6-mos forward Turkey lira UK pound 1-mos forward 1-mos forward .9255 1.6893 .5920 -2.0 3-mos forward .9216 1.0851 -4.0 1.6889 .5921 -2.0 6-mos forward .9157 1.6881 .5924 -2.0 3-mos forward 6-mos forward China yuan 1598 6.2590 1.6867 .5929 -2.0 1.0920 -3.9 3.4 7.7528 unch 60.150 -2.8 1290 .01663 Middle East/Africa .0000865 11555 -5.0 Hong Kong dollar India rupee Indonesia rupiah Japan yen 1-mos forward 3-mos forward 2.6527 .3770 unch 102.32 -2.8 .009773 .009775 Bahrain dinar Egypt pound Israel shekel 1427 7.0081 0.8 102.31 -2.9 2896 3.4528 -0.5 .009778 102.27 -2.9 Jordan dinar 1.4123 .7081 0.1 6-mos forward .009784 102.21 -2.9 Kuwait dinar 3.5606 2809 -0.6 0.7 Malaysia ringgit New Zealand dollar Pakistan rupee .3062 3.2659 -0.5 .8633 1.1584 -4.8 .01014 98.645 -6.4 .0224 44.610 0.5 Lebanon pound Saudi Arabia riyal South Africa rand 1516.10 .2666 3.7507 unch 0953 10.4879 unch 2723 3.6731 unch Philippines peso UAE dirham .7982 1.2528 -0.8 Singapore dollar South Korea won Taiwan dollar .0009682 1032.80 -2.2 Close Net Chg %ChgYTD%Chg 1.1 .03305 30.256 .03090 32.367 -1.1 Thailand baht WSJ Dollar Index 72.85 -0.01 -0.01 -1.31 Vietnam dong .00004742 21090 -0.2 Sources: ICAP plc., WSJ Market Data Group SOURCE: The Wall Street Journal, 2014. US$ vs, -Thurs- YTD chg .0006596
