Question
You are US company, 300,000 BP (British Pound) payable to UK in one year. Answer in terms of US$. Information for Forward Contract: Forward exchange
You are US company, 300,000 BP (British Pound) payable to UK in one year. Answer in terms of US$.
Information for Forward Contract:
Forward exchange rate (one yr): 1.52 $/BP
Information for Money Market Instruments (MMI):
Current exchange rate: 1.49 $/BP
Investment return at Aerion Fund Management (in UK): 7% annual
Interest rate of borrowing from Bank of America (in USA): 2% annual
Information you need for Currency Options Contract:
Options premium: 0.015 $/BP
Interest rate of borrowing from Bank of America (USA): 2% annual
Allowed to exercise options at 1.54 $/BP
What are the costs of MMI? (Answer in US$ of course. You are US company!)
Group of answer choices
about $442,971
about $423,464
about $426,112
about $423,056
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Satoshi S Vision The Art Of Bitcoin
Authors: Craig Wright ,Paul Democritou
1st Edition
1688735925, 978-1688735927
