Forward Exchange Rates

Please complete the following problems: 1- Using exchange rates – (Relative Purchasing Power Parity – The inflation rate in the US is projected at 3 percent per year for the next several years. The New Zealand inflation rate is projected to be 5 percent during that time. Te exchange rate is currently NZ\$1.66. Based on relative PPP, what is the expected  exchange in two years). Answer the following questions: a- If you have \$100, how many euros can you get? b- How much is one euro worth? c- If you have 5 million euros, how many dollars do you have? d- Which is worth more, a New Zealand dollar or a singapore dollar? e- Which is worth more a Mexican peso or a Chilean peso?  f- How many Mexican pesos can you get for a euro? What do you call this rate? g- Per unit, whati s the most valuable currency of those listed? The least valuable? 2- Using the Cross Rate – (Relative Purchasing Power Parity – The inflation rate in the US is projected at 3 percent per year for the next several years. The New Zealand inflation rate is projected to be 5 percent during that time. Te exchange rate is currently NZ\$1.66. Based on relative PPP, what is the expected  exchange in two years). Answer the following questions: a-Which would you rather have, 100 dollars or 100 UK Pound? Why? b-Which would you rather have, 100 Swiss Francs or 100 Uk Pound? Why? c- What is the cross rate for Swiss francs in terms of British pounds? For British pounds in terms of Swiss francs? 3- Forward Exchange Rates – (Relative Purchasing Power Parity – The inflation rate in the US is projected at 3 percent per year for the next several years. The New Zealand inflation rate is projected to be 5 percent during that time. Te exchange rate is currently NZ\$1.66. Based on relative PPP, what is the expected  exchange in two years). Answer the following questions: a-What is the six month forward rate for the Japanese yen in yen per US dollar? Is the yen selling at a premium or a discount? Explain. b-What is the three month forward rate for Australian dollars in US dollars per Australian dollar? Is the dollar selling at a premium or a discount? Explain. c-What do you think will happen to the value of the dollar relative to the yen and the Australian dollar, based on the information in the figure? Explain 4- Using Spot and Forward Exchange Rates – Suppose the spot exchange rate for the Canadian dollar is Can\$1.29 and six month forward rate is Can\$1.31. a- Which is worth more, a US dollar or Canadian dollar? b-Assuming absolute PPP holds, what is the cost in the US of an Elkhead beer if the price in Canada is Can\$2.50? Why might the beer actually sell at a different price in the US? c- Is the US dollar selling at a premium or a discount relative to the Canadian dollar? d-Which currency is expected to appreciate in value? e-Which country do you think as higher interest rates – the US or Canada? Explain. 5- Cross Rates and Arbitrage – Suppose the Japanese yen exchange is Y114=\$1, and the British pound exchange rate is 1 Pound=\$1.26. a-What is the cross rate in terms of yen per pound? b-Suppose the cross rate is Y 147=1 Pound. Is there an arbitrage opportunity here? If there is, explain how to take advantage of the mispricing and the potential arbitrage profit. What is you arbitrage profit per dollar used? 6- Interest Rate Parity – Relative Purchasing Power Parity – The inflation rate in the US is projected at 3 percent per year for the next several years. The New Zealand inflation rate is projected to be 5 percent during that time. Te exchange rate is currently NZ\$1.66. Based on relative PPP, what is the expected  exchange in two years). Answer to the following: Suppose interest rate is parity holds, and the current six month risk free rate in the US is 1.3 percent. What must the six month risk free rate be in the Great Britain? In Japan? In Switzerland? 10-Exchange Rats and Arbitrage – Suppose the spot and six month forward rates on the Norwegian krone are Kr 8.39 and Kr 8.48, respectively. The annual risk free rate is the US is 3.8 percent and the annual risk free rate in Norway is 5.7 percent. a- Is there an arbitrage opportunity here? If so, how would you exploit it? b-What must the six month forward rate be to prevent arbitrage?

Struggling to find relevant content? Order a custom essay on
Forward Exchange Rates
Let our experts save you the hassle
Calculate the price
Make an order in advance and get the best price
Pages (550 words)
\$0.00
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Upload your instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with GPA Fix
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
Testimonials
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Other
great
Customer 452813, July 5th, 2022
DISCUSSION D SCIENCE 210
GREAT
Customer 452813, June 28th, 2022
Other
great
Customer 452813, June 25th, 2022
Social Work and Human Services
Great Work !!!
Customer 452587, November 9th, 2021
Other
GREAT
Customer 452813, June 25th, 2022
Social Work and Human Services
Excellent! Done earlier than needed and with more sources than needed! Great work!
Customer 452485, August 22nd, 2021
Marketing
Thank you great job
Customer 452813, July 10th, 2022
Nursing
Always perfect! Thank you!!!
Customer 452453, April 15th, 2021
ENVIRONMENT SCIENCE
EXCELLENT
Customer 452813, June 19th, 2022
Nursing
Always a job well done. I really appreciate the hard work.
Customer 452453, January 4th, 2021
Criminal law
Thank You!
Customer 452465, January 29th, 2021
Nursing
Always on time and a life saver for sure!!!!!!!!!!!!
Customer 452453, October 22nd, 2021
11,595
Customer reviews in total
96%
Current satisfaction rate
3 pages
Average paper length
37%
Customers referred by a friend
OUR GIFT TO YOU
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat