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A foreign exchange dealer in Warsaw provides quotes for spot and 3-month forward rates for the Polish zloty against the dollar.
Bid (PZ/$)
Ask (PZ/$)
Spot
4.0040
4.0200
3-month forward
3.9690
3.9888
a. What would you receive in dollars if you sold PZ 5 million at the spot rate?
b. What would it cost in dollars to purchase PZ 20 million forward three months. When would you make payment?
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