Spot rates for 90-day, 180-day, 270-day, and 360-day loans are 2%, 2.5%, 2.75%, and 3%, respectively....
Spot rates for 90-day, 180-day, 270-day, and 360-day loans are 2%, 2.5%, 2.75%, and 3%, respectively. Given this information, the 90-day forward rate 180 days from now is closest to:
Group of answer choices
A. 3.21%
B. 2.88%
C. 3.67%
Homework Answers
90-day Forward Rate 180 days from now =
[(270 days rate*270)-(180 day rate*180)]/(270-180)
= [(2.75*270)-(2.5*180)]/90
= 742.5-450)/90
= 3.25%
Add Answer to:
Spot rates for 90-day, 180-day, 270-day, and 360-day loans are
2%, 2.5%, 2.75%, and 3%, respectively....
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Assume that Parker Company will receive SF200,000 in 180 days. Assume the following interest rates: 360-day...
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180-day U.S. interest rate 180-day Fijian interest rate 180-day forward rate of Fijian dollar (F$) Spot...
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(4)Consider the following information: .2.5% 90-day forward rate for the pound.. ..........$1.50 Spot rate for the pound.............................51.52 (a)Assume that CSI company based in the...
(4)Consider the following information: .2.5% 90-day forward rate for the pound.. ..........$1.50 Spot rate for the pound.............................51.52 (a)Assume that CSI company based in the US will receive 1,000,000 pounds in 90 days, would it be better off using the forward hedge or money market hedge? Substantiate your answer with appropriate quantitative evidence. (b)Assume that the same CSI company will need 1000,000 pounds in 90 days and wishes to hedge its payables position. Would you recommend a forward hedge or a...
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