Suppose the Japanese yen exchange rate is ¥70.47 = $1, and the
British pound exchange rate is £1 = $1.50.
a. What is the cross-rate in terms of yen per pound?
(Do not round intermediate calculations and round your
answer to 2 decimal places, e.g., 32.16. Do not include the yen
sign (¥).)
Cross-rate
¥
b. Suppose the cross-rate is ¥109 = £1. What is
the arbitrage profit per dollar? (Do not round intermediate
calculations and round your answer to 4 decimal places, e.g.,
32.1616.)
Arbitrage profit per dollar
$
Cross Rate of yen per pound = (Yen/Dollar)*(Dollar/Pound)
= (70.47)*1.50
= 105.705 Yen/Pound
b.Actual Rate is Yen 109/Pound
Convert 1 Dollar into pound and get 1/1.5 = 0.66667
Convert Pound into Yen and Get 0.666667*109 = Yen 72.666667
Convert Yen into Dollar = 72.67/70.47 = $1.03117
Hence, arbitrage profit per dollar = 1.03117-1
= $0.03117
i.e. 0.0312
Suppose the Japanese yen exchange rate is ¥70.47 = $1, and the British pound exchange rate...
Suppose the Japanese yen exchange rate is ¥78.47 = $1, and the British pound exchange rate is £1 = $1.57. a. What is the cross-rate in terms of yen per pound? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Do not include the yen sign (¥).) Cross-rate ¥ b. Suppose the cross-rate is ¥125 = £1. What is the arbitrage profit per dollar? (Do not round intermediate calculations and round your answer to...
Suppose the Japanese yen exchange rate is ¥80 = $1, and the British pound exchange rate is £1 = $1.64. a. What is the cross-rate in terms of yen per pound? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Cross-rate 131.2 £ b. Suppose the cross-rate is 136 = £1. What is the arbitrage profit per dollar used? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.)...
Suppose the Japanese yen exchange rate is ¥77 = $1, and the British pound exchange rate is £1 = $1.61. a. What is the cross-rate in terms of yen per pound? (Round your answer to 2 decimal places, e.g., 32.16.) Cross-rate ¥/£ b. Suppose the cross-rate is ¥126 = £1. What is the arbitrage profit per dollar used?
Use the information in the table below to answer the following questions: Japanese yen 6-mos forward British pound 3-mos forward in U.S. S 009232 .009318 1.5863 1.5855 per U.S. 108.32 107.32 6304 .6307 a. The six-month forward rate for the Japanese yen is per U.S. dollar. The yen is selling at a premium because it is more expensive in the forward market than in the spot market. (Do not round intermediate calculations and round your answer to 2 decimal places,...
Use the information in the table below to answer the following questions: in U.S. $ per U.S. $ Japanese yen .009224 108.41 6-mos forward .009313 107.38 British pound 1.5848 .6310 3-mos forward 1.5833 .6316 a. The six-month forward rate for the Japanese yen is per U.S. dollar. The yen is selling at a (Click to select)discountpremium because it is (Click to select)less expensivemore expensive in the forward...
Suppose a Polish zloty is selling for $0.3465 and a British pound is selling for $1.5058. What is the exchange rate (cross rate) of the Polish zloty to the British pound? That is, how many Polish zlotys are equal to a British pound? (Do not round intermediate calculations. Round your answer to 4 decimal places.) Exchange rate zloty/pound
Problem 31-9 Exchange Rate Risk Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.2857 S$/US$. You have just placed an order for 26,000 motherboards at a cost to you of 231.50 Singapore dollars each. You will pay for the shipment when it arrives in 90 days. You can sell the motherboards for $196 each. What is your profit at the current exchange rate? (Do not round intermediate calculations and round your answer to 2...
Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.2829 S$/US$. You have just placed an order for 29,000 motherboards at a cost to you of 237.00 Singapore dollars each. You will pay for the shipment when it arrives in 90 days. You can sell the motherboards for $195 each. What is your profit at the current exchange rate? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) ...
Suppose we have the following exchange rate quotes: in US$ per US$ Euro area (€) 1.3455 .7432 Mexico (Ps) .0781 12.8113 a. If you have $225, you can get euros. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Use the €/$ exchange rate in your calculation.) b. One euro is worth $ . (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) c. If you...
Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.5134 S$/US$. You have just placed an order for 35,000 motherboards at a cost to you of 231.00 Singapore dollars each. You will pay for the shipment when it arrives in 90 days. You can sell the motherboards for $160 each. Calculate your profit if the exchange rates stay the same over the next 90 days. (Do not round intermediate calculations and round your answer to 2...