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finance problems with solution

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solution


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Question;5.) On July 4, 2012, you convert $500,000 U.S. dollars to Japanese yen in the spot foreign exchange market and purchase a one-month forward contract to convert yen into dollars. How much will you receive in U.S. dollars at the end of the month? Use the data in Table 13?1 for this problem.8.) The following are the foreign currency positions of an FI, expressed in the foreign currency:a. What is the FI?s net exposure in Swiss francs stated in SF and $s?b. What is the FI?s net exposure in British pounds stated in ? and $s?c. What is the FI?s net exposure in Japanese yen stated in ? and $s?d. What is the expected loss or gain if the SF exchanges rate appreciates by 1 percent? State your answers in SFs and $s.e. What is the expected loss or gain if the ? exchange rate appreciates by 1 percent? State your answers in ?s and $s.f. What is the expected loss or gain if the ? exchange rate appreciates by 2 percent? State your answers in ?s and $s.7.) Countries A and B have exports of $2 billion and $6 billion, respectively. The total interest and amortization on foreign loans for both countries are $1 billion and $2 billion, respectively.a. What is the debt service ratio (DSR) for each country?b. Based only on this ratio, to which country should lenders charge a higher risk premium?c. What are the shortcomings of using only these ratios to determine your answer in part (b)?8.) How do price and quantity risks affect the variability of a country?s export revenue?28.) Go to the Heritage Foundation website at www.heritage.org/index and find the most recent Economic Freedom Index for the United States using the following steps. Click on ?Explore the data.? This will bring the file onto your computer that contains the relevant data. What factors led to this rating?

 

Paper#47854 | Written in 18-Jul-2015

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