User Account

All Pages

Boisjoly watch imports has agreed to purchase 15000 swiss

Assignment Help Finance Basics
Reference no: EM13572912

Boisjoly Watch Imports has agreed to purchase 15,000 Swiss watches for 1 million francs at today"s spot rate. The firm"s financial manager, James Desreumaux, has noted the following current spot and forward rates:

U.S. Dollar/Franc

Franc/U.S. Dollar

Spot

1.6590

0.6028

30-day forward

1.6540

0.6046

90-day forward

1.6460

0.6075

180-day forward

1.6400

0.6098

On the same day, Desreumaux agrees to purchase 15,000 more watches in 3 months at the same price of 1 million francs.

a. What is the price of the watches, in U.S. dollars, if purchased at today"s spot rate?

b. What is the cost, in dollars, of the second 15,000 batch if payment is made in 90 days and the spot rate at that time equals today"s 90-day forward rate?

c. If the exchange rate for the Swiss franc is 0.50 to $1 in 90 days, how much will he have to pay for the watches (in dollars)?

Reference no: EM13572912

Questions Cloud

Write a letter to thank your interviewer and mention that : assume you had a very successful interview at the company and you are very keen to get the job. however now you are
Determine the amount of actual bad debt write-offs made : aldos financial statements for the 2010 and 2009 fiscal years contained the following informationbalance sheets in
Portland companys ironton plant produces precast ingots : portland companys ironton plant produces precast ingots for industrial use. carlos santiago who was recently appointed
The rapid proliferation of the world wide web web has seen : assignment technology driven marketingthe rapid proliferation of the world wide web web has seen the emergence of a
Boisjoly watch imports has agreed to purchase 15000 swiss : boisjoly watch imports has agreed to purchase 15000 swiss watches for 1 million francs at todays spot rate. the firms
Lantto air uses two measures of activity flights and : lantto air uses two measures of activity flights and passengers in the cost formulas in its budgets and performance
In 2013 tommys construction corp began construction work : in 2013 tommys construction corp began construction work under a three- year contract. the contract price is 1600000.
The companys beta is 125 the market risk premium is 500 and : the isberg company just paid a dividend of 0.80 per share and that dividend is expected to grow at a constant rate of
On february 1 2013 can do it trucks sold a diesel rig to ma : on february 1 2013 can do it trucks sold a diesel rig to ma transports for 250000 receiving a 50000 down payment and a

Reviews

Write a Review

Finance Basics Questions & Answers

  Computation of ytm if the bonds are purchased at issue price

Computation of YTM if the bonds are purchased at Issue price & Market price and analyzing the difference

  Why would a preferred stockholder want the stock

Why would a preferred stockholder want the stock to have a cumulative dividend feature and protective provisions?

  What is the beta of stock b

Currently, the risk-free rate is 4 percent. Stock A has an expected return of 13 percent and a beta of 1.2. Stock B has an expected return of 9 percent. The stocks have equal reward-to-risk ratios. What is the beta of stock B?

  What is the conversion price

B&O Railroad's convertible debentures were issued at the $1000 par value in 2002. At any time prior to their maturity on Feb. 1, 2022, a debenture holder can exchange a bond for 25 shares of common stock. What is the conversion price. Must show wo..

  How health care organizations interpret corporate cost

Discuss how health care organizations interpret the corporate cost of capital and how that interpretation would be applied to capital investment decisions. explain your rationale.

  What is the firms market value capital structure

If Titan Mining is evaluating a new investment project that has the same risk as the firm's typical project, what rate should the firm use to discount the project's cash flows?

  Te current beta of the portfolio is 164 and the beta of

you are managing a portfolio of 10 stocks which are held in equal amounts. the current beta of the portfolio is 1.64

  How should an insurance company consider nonperformance

how should an insurance company consider nonperformance risk relating to separate components of a hybrid insurance

  How much would the stock be worth at the end

Management expect the dividends to grow at a constant rate of 10% per year. If the required rate of return on the companys stock is 14%, how much would the stock be worth at the end of three years from today?

  What are the after-tax proceeds from the sale

Zippy Corporation just purchased computing equipment for $24,000. The equipment will be depreciated using a five-year MACRS depreciation schedule.

  Which investment would be chosen

Assume that an investor is offered a choice of a risk-free government bond or a high-risk corporate stock. Further assume that the expected return is the same for both. According to one of the axioms of finance, which investment would be chosen?

  Did these infusions disrupt the normal cost of capital

Discuss the effects on the "Weighted Average Cost of Capital" for the firms that received these capital infusions. Did these infusions disrupt the normal cost of capital for other firms?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd