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please show work Today. you observe the following rates on the foreign exchange market: - S(CAD/$)=CAD1.3317/$ - F6(CAD/$)=CAD1.3578/$ Based on your economic forecast, you believe

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Today. you observe the following rates on the foreign exchange market: - S(CAD/$)=CAD1.3317/$ - F6(CAD/$)=CAD1.3578/$ Based on your economic forecast, you believe the spot exchange rate will be CAD1.3200/ $ in six months. You would like to buy or sell CAD100,000. 1. Calculate the forward premium or discount on an annualized basis for the exchange rate (CAD/\$). 2. What actions should you take to speculate in the forward market? 3. How much will you make if your prediction is correct? 4. Assume the spot exchange rate is CAD1.3700/\$ in six months. How much will be your speculative profit

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