Question

15 Suppose that the current exchange rate is €1.00 - $1.60. The indirect quote from the US. perspective is A) €0.6250 - $1.00 3) €1.50 - $1.00 €1.00 - $1.60 Dy none of the options 19) The bid price A) is the price that a dealer stands ready to pay B) is the price that a dealer stands ready to sell at. is the price that the dealer has just paid for something, his historical cost of the most recent trade. D) refers only to auctions like eBay, not over-the-counter transactions with dealers. 20) 20. If the Se bid and ask prices are $1.50€ and $1.51/, respectively, the corresponding ES bid and ask prices are A) $1.51 and $1.50 B) €0.6667 and 0.6623. €0.6623 and €0.6667 D) cannot be determined with the information given Country US Seguir. Currency per USS Tuesday Monday Tuesday Monday 2.0000198000 Britain (Pound) 162500 3000 0 SOST Month Forward 201009000.49750503 Maths onward 202002.00000.4950 05000 6 Months Forward 201100 0 100 074975 Months Forward 20400 2 20200 0.4902 0950 TE SO0 15000 1.450006667 0.6757 Month Forward 13100 1.4900 0 66223 0.6711 Months Forward 132001 S000076579 076667 6 Months Forward 15300 13100 0 6536 0.6623 12 Months Forward 13400 1200 0 7604 0.6579 Using the table shown, what is the spot cross-exchange rate between pounds and curo? A €1.00 - 0.75 B) £1.00 - €0.75 £133 €1.00 Dy none of the options Suppose you observe the following exchange rates: El - $1.50; 120 - $1.00. Calculate the curyen exchange rate. A -E1.00 B) 133.33 - €1.00 GET=2.50 D) V1.00 - €180 22)

Answer 1

Solution In the given question : Direct Quote in terms of Euro: Quote (€/$) 1.6 Which means for 1 € we will get 1.6 $ Indirect Quote in terms of Dollar: Indirect Quote ($/ €) Direct Quote (€/$) 1 1.6 0.625 Which means for 1 $ we will get 0.625 € Hence, as per above discussion option A] €0.625 = 1$ is correct *Note: We are allowed to answer only one question