Question
The current spot exchange rate is USD 1.55/ EUR 1.00 and the three-month forward rate is USD 1.50/ EUR 1.00. You enter into a short
The current spot exchange rate is USD 1.55/ EUR 1.00 and the three-month forward rate is USD 1.50/ EUR 1.00. You enter into a short forward position on EUR 1,000. At maturity in three months, the spot exchange rate is USD 1.25/ EUR 1.00. what is your profit on the forward contract in USD?
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Financial Institutions Management A Risk Management Approach
Authors: Anthony Saunders, Marcia Cornett, Otgo Erhemjamts
10th Edition
1260013820, 978-1260013825
