Question
The current spot exchange rate is $1.55/euro and the three-month forward rate is $1.50/euro. You enter into forward contract taking a short position on 1,000
"The current spot exchange rate is $1.55/euro and the three-month forward rate is $1.50/euro. You enter into forward contract taking a short position on 1,000 euros. At maturity, the spot exchange rate is $1.60/euro. How much have you made or lost? "
| Lost $100 | ||
| Made 100 euros | ||
| Lost $50 | ||
| Made $150 |
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Financial Markets And Institutions
Authors: Jeff Madura
8th Edition
0324568215, 978-0324568219
