Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Tomoko Matsubara is a currency arbitrager for Showa and company, Yokohama. The spot rate this morning is 120.50 Yen/$, and early indications are that 90-day interest rates in the United States will rise from their current level of 4.125%. The U.S. Federal Reserve Bank, the central bank, is worried about rising inflation and has been publicly considering raising interest rates 25 basis points (1/4%). The 90-day forward exchange rate quoted to Matsubara-san by local banks such as Daichi Kangyo are all about the same, 119.60 Yen/$. The current 90-day Yen interest rate is 0.5000% (half of one percent). Matsubara-san has 300 million Yen at her disposal.
a. How can Matsubara-san make a profit through covered interest arbitrage? How much in yen can she hope to make in profit in 90 days?
b. What should Matsubara-san do with her 300 million yen if she wished to speculate through uncovered interest arbitrage? What could she expect to make in profit with this strategy?
Starting with your current situation, what must you do to ensure an annual retirement income of $75,000 starting at age 65? Make sure that you submit time value of money calculations that support the conclusions
An asset has had an arithmetic return of 10.3 percent and a geometric return of 8.3 percent over the last 90 years. What return would you estimate for this asset over the next 10 years? 25 years? 30 years?
APT: Say a given market index (M) is a well-diversified portfolio and has an expected return of 15%. Deviations from this expected return
A bank wants to lock in the 3-month interest rate starting on June 20, 2017. Currently, 6/2017 Eurodollar futures price is 94.51 and 9/2017 Eurodollar futures price is 97.55. What is the lock in 3-month interest rate between 6/2017 and 9/2017? (margi..
Hammett, Inc. has sales of $19,570, costs of $9,460, depreciation expense of $2,130, and interest expense of $1,620. If the tax rate is 35 percent, what is the operating cash flow, or OCF? App Co. issued 15-year, $1,000 bonds at a coupon rate of 6 pe..
A project requiring a $9000.00 initial investment is expected to provide after tax inflows of $4000. Per year for 3 years A- Determine the payback period. B- Calculate the net present value if the firms cost of capital is 10%
That Wich Corp. had additions to retained earnings for the year just ended of $397373. The firm paid out $191215 in cash dividends, and it has ending total equity of $4772974. The company currently has 150,000 shares of common stock outstanding. What..
Danielle Salomon invests in a 10-year ordinary annuity for a graduation present. She contacts her bank and tells them to open an account and automatically deposit $500 at the end of each of the first 5 years, and $1000 at the end of each of the remai..
Calculate the price of the bond for a market interest rate of 3% per half year. Compare the capital gains for the interest rate decline to the losses incurred when the rate increases to 5%
Prepare the year-end journal entry for the inventory. If richards used IFRS, determine the lower of cost or Net realizable value of inventory.
Tea&Juices, a foreign producer of soft drinks, is considering expanding its activities to Canada. To evaluate the profitability of the business, the management has decided to use as benchmarks two other foreign producers of soft drinks who have alrea..
what is the minimum expected annual return for Stock 3 that will enable Michele to achieve her investment requirement?
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd