Answer Happy

Exercise 1: Cross courses (8 points For the day of 21/04/2016 we observe on the square of Mexico the following courses • USD MXN. 1.1020 - 11030 . GBP/MXN 1.8195 - 18230 EURMXN:1 2745-1.2760 Work to do 1 Calculate the following cross prices (bio-askr EUR USD GBP EUR GBP/USD 2) Al what price would an individual buy the EUR USD? 3) At what price does an individuals the GBP EUR? a Give the courses to the certain of the Mexican peso compared to previous currencies Exercise 2 Arbitration (4 points) In the middle of the day, we observe on the foreign exchange market In case the following courses: -100 JPY/USD 0.7530 CHF/USD 0.7185 CHF/JPY96 3120 Work to do 1) Show that there is an arbitrage opportunity 2) Qualify this arbitrage opportunity 3) If this arbitrageur holds $100.000 caluate the gain resulting from the arbitrage opportunity Exercise 3: Arbitration (2 points) If the yen is quoted at 0.0093 dollars and the euro at 1.3560 dollars at New York 1) What should the yen rate be in Paris? 2) If the rate of the yen (100) is equal to 0.64 euro in France What is going on Exercise 4: Currency risk 14 points) On January 10. a French Industrialist sels equipment to a English customer for a price of 5 milion GBP to be delivered in March, paid 20% on order (January 10) and the balance on May 31st. The manufacturer's rule is to cover all his risks of exchange through forward purchases or sales on January 10, the Spot exchange rate is EUR GBP = 0.9480 - 8 Work to do: 1) Calculate the gain or loss if the forward exchange rate is EUR/GBP 0.9488-92 2) Calculate the gain or loss if the forward exchange rate is EUR/GBP = 0.9464-67
Exercise 1: Cross courses (8 points) For the day of 21/04/2016, we observe on the square of Mexico. the following courses: • USD/MXN 1.1020 - 1.1030 . GBP/MXN: 1.8195 - 1.8230 EUR/MXN:1.2745-1.2760 Work to do: 1 Calculate the following cross prices (bid-ask): EUR/USD; GBP/EUR; GBP/USD. 2) At what price would an individual buy the EUR/USD? 3) At what price does an individual sell the GBP/EUR? a Give the courses to the certain of the Mexican peso compared to previous currencies. Exercise 2: Arbitration (4 points) In the middle of the day, we observe on the foreign exchange market in cash the following courses: • 100 JPY/USD=0.7530 CHF/USD=0.7185 CHF/JPY=95.3120 Work to do: 1) Show that there is an arbitrage opportunity. 2) Qualify this arbitrage opportunity. 3) If this arbitrageur holds $100,000, calculate the gain resulting from the arbitrage opportunity.