ssume that interest rate parity exists. You expect that the one-year nominal interest rate in the U. S. is 7%, while the one-year nominal interest rate in Australia is 11%. The spot rate of the Australian dollar is $.60. You will need 10 million Australian dollars in one year. Today, you purchase a one-year forward contract in Australian dollars. How many U. S. dollars will you need in one year to fulfill your forward contract? A. $5,784,000 B. $5,387,000 C. $6,184,000 D. $8,356,000
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “ssume that interest rate parity exists. You expect that the one-year nominal interest rate in the U. S. is 7%, while the one-year nominal ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Gross primary productivity is higher than net primary productivity. The difference between the two is
Answers (1)
Wotan owns 1,000 shares of a firm that has just announced an increase in its div - idend from $2.00 to $2.50 a share. the share price is currently $150.
Answers (1)
A country has private saving of $500 billion, public saving of - $100 billion, domestic investment of $150 billion, and net capital outflow of $250 billion. what is its supply of loanable funds?
Answers (1)
The Fed buys $20,000 of government securities. The desired reserve ratio is 5 percent and the currency drain is zero. What will be the change in the quantity of money?
Answers (1)
Return to Amir's original purchase date of July1, 20X5. Assume that Amir uses straight-line method of depreciation and sells the equipment for $36,500 on July 1, 20X9. The result of the sale of the equipment is a gain (loss) of: a. ($3,500) b.
Answers (1)
New Questions in Business
When the consumer price index rises, the typical family a. has to spend more dollars to maintain the same standard of living. b. can spend fewer dollars to maintain the same standard of living. c. finds that its standard of living is not affected. d.
Answers (1)
A magazine subscription costs $45 per year at the beginning of each year, or $115 now for a three-year subscription. If the subscriber elects to pay the $115 now, the rate of return on the investment will be nearest to:
Answers (2)
The second step in rational decision making is to: choose the solution that maximizes value. identify the criteria that are important in making the decision. evaluate the alternatives. implement the alternative.
Answers (1)
What impact will a spike in wages cause to the labor demand curve?
Answers (1)
A company issued 8%, 15-year bonds with a par value of $500,000 that pay interest semiannually. The market rate on the date of issuance was 8%.
Answers (1)