Questions 35-39 are based on the following information: In October 2013, there is a consensus in the capital market that the annual inflation rate is likely to be 3.5% in US and -1.5% in China for the next two years. Based on this information, answer the following questions regarding your prediction on foreign exchange rate. Chinese Yuan will be selling at a forward [l1] (premium/discount). The size of the forward premium/discount is [l2] %. Use approximate version of parity relationships. (2 points)
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Although IRP tends to hold, it may not hold precisely all th…
Although IRP tends to hold, it may not hold precisely all the time
The TD 5/5 (3/3 organ) for the eye lens is:
The TD 5/5 (3/3 organ) for the eye lens is:
If you think that the euro is going to appreciate against th…
If you think that the euro is going to appreciate against the dollar
Yesterday, you entered into a futures contract to buy €62,50…
Yesterday, you entered into a futures contract to buy €62,500 at $1.20 per €. Your initial performance bond is $1,500 and your maintenance level is $500. At what settle price will you get a demand for additional funds to be posted?
Marta al final pide [pregunta]
Marta al final pide [pregunta]
Which of the following statements on Purchasing Power Parity…
Which of the following statements on Purchasing Power Parity (PPP) is (are) correct?
¿Cómo se llama el restaurante donde están Marta y su hija?
¿Cómo se llama el restaurante donde están Marta y su hija?
Open interest in currency futures contracts
Open interest in currency futures contracts
Suppose that the one-year interest rate is 5.0 percent in It…
Suppose that the one-year interest rate is 5.0 percent in Italy, the spot exchange rate is $1.20/€, and the one-year forward exchange rate is $1.18/€. What must one-year interest rate be in the United States? Hint: Use exact version of IRP equation.