Question
Six months ago, you bought 1 million Euros at a forward rate of 1.200 USD/EUR. This contract matures today, and the spot exchange rate is
Six months ago, you bought 1 million Euros at a forward rate of 1.200 USD/EUR. This contract matures today, and the spot exchange rate is 1.100 USD/EUR.
What is the profit from the forward contract in USD?
1(b) - Six months ago, you bought 1 million Euros at a forward rate of 1.200 USD/EUR. This contract matures today, and the spot exchange rate is 1.100 USD/EUR.
What is the profit from the forward contract in EUR?
2 (a) - One year ago, you sold 1 million British pounds (GBP) at a forward rate of 1.25 USD/GBP. This contract matures today, and the spot exchange rate is 1.30 USD/GBP.
What is the profit from the forward contract in GBP?
2 (b) One year ago, you sold 1 million British pounds (GBP) at a forward rate of 1.25 USD/GBP. This contract matures today, and the spot exchange rate is 1.30 USD/GBP.
What is the profit from the forward contract in GBP?
3.Two years ago you sold forward 1 million Canadian dollars (CAD) at a forward rate of 0.800 USD/CAD. You have no CAD, so this transaction is what we would call a "naked forward." The forward contract matures today and the spot exchange rate is 0.7850 USD/CAD.
What is the profit from the forward contract in USD?
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Lets calculate the profits for each scenario 1 Profit from the forward contract in USD Forward rate ...
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Fundamentals of Advanced Accounting
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
5th edition
978-0077924379, 77924371, 978-0078025396, 78025397, 978-0077425654, 77425650, 978-0077667061
