Suppose the 6 month forward rate in the Yen Dollar market is F( $) 180 100 $ Your internal analysts think that the future spot rate 6 months from now will be S( $) 180 110 $ Will you assume a short or a long position on the Yen using forward contracts a Short position on Yen using Forward Contracts...

The answer is b Long position on Yen using Forward Contracts Heres why The forward rate F180 100 rep ...

Suppose the 6 month forward rate in the Yen-Dollar market is F(/$) 180 = 100/$. Your internal

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Question:

Suppose the 6 month forward rate in the Yen-Dollar market is F(/$)₁₈₀= 100/$. Your internal analysts think that the future spot rate 6 months from now will be S(/$)₁₈₀ =110/$. Will you assume a short or a long position on the Yen using forward contracts?

a. Short position on Yen using Forward Contracts.

b. Long position on Yen using Forward Contracts.