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VERY URGENT PLSSS Subject:international finance Question 1 Samad Zain, an exchange trader wants to invest RM3,000,000 or the equivalent current at prevailing market rate. He

VERY URGENT PLSSS

Subject:international finance

Question 1 Samad Zain, an exchange trader wants to invest RM3,000,000 or the equivalent current at prevailing market rate. He is analyzing forex exchange opportunity between Malaysia and New Zealand. The followings are the selected information of both countries:

Country Inflation Rate Interest Rate
Malaysia 3.5% 4.6%
New Zealand 4.1% 6.4%

Exchange rate

Units of foreign currency per unit of Malaysian Ringgit Bid Ask
N e w Zealand Dollar $0.3889 $0.3878

Bank Negara's Forward Swap Rate (360-day): 42- 36 Note: [The calculation is to be based on four (4) decimal points to minimize rounding errors.] Required:

e. What is the appropriate 360-day forward exchange rate fi Interest Rate Parity prevail? (Hint: Use middle rate) (3 Marks) F. Calculate the expected spot rate in 360-day for bid and ask based on Purchasing Power Parity (PPP). (3 Marks)

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