A bank manager believes the peso will appreciate relative to the peso in six months. The current
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Question:
A bank manager believes the peso will appreciate relative to the peso in six months. The current spot rate for pesos is 10 pesos/euro and the six month forward rate is .08/peso. The manager agrees to enter into a six month forward contract with 6 million pesos attached. The spot rate is 20 pesos/euro on the day the forward contract expires.
Find the currency trader's profit/loss (in euros) from their forward contract. Round intermediate steps to four decimals and your final answer to two decimals.Do not use currency symbols or words when entering your response.
Related Book For
Advanced Accounting
ISBN: 9780132568968
11th Edition
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
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