Suppose your company imports computer motherboards from Singapore. The exchange rate is given in Figure 22.1. You
Question:
Suppose your company imports computer motherboards from Singapore. The exchange rate is given in Figure 22.1. You have just placed an order for 30,000 motherboards at a cost to you of 172.50 Singapore dollars each. You will pay for the shipment when it arrives in 90 days. You can sell the motherboards for $150 each. Calculate your profit if the exchange rate goes up or down by 10 percent over the next 90 days. What is the break-even exchange rate? What percentage rise or fall does this represent in terms of the Singapore dollar versus the U.S. dollar?
Figure 22.1
Transcribed Image Text:
The New York foreign exchange mid-range rates below apply to trading among banks in amounts of $1 million and more. as quoted at 4 pm. Eastern time by Reuters and other sources. Retail transactions provide fewer units of foreign currency per dollar. Rates for the 12 Euro currency countries are derived from the latest dollar-euro rate using the ex- change ratios set 1/1/99 Country Argentina (Pesc)....... Australia (Collar). Austria (Schifing).. Tuesday, September 4, 2001 EXCHANGE RATES Bahrain (Dinar).. M Belgium (Franc). Brazil (Real). Britain (Pound) 1-month tonward.. 3-months forward 8-months forward ne THE La Canada (Dollar)... 1-month forward. 3-months forward 5-months forward..... Chle (Peso) China (Renminbi). Colombia (Peso). er m CURRENCY TRADING U.S. SEQUIN Tue 1.0003 5203 06455 2.6525 6412 6409 6405 6-103 001504 1208 0004336 Fri 0220 .3905 1.4435 1.4541 1.4419 1.4526 1.4387 1.4492 1.4340 1.4443 1.0021 5303 36026 2.6525 0226 45.4150 3900 2.5505 6928 5935 6.951 6449 6147 6442 6139 CURRENCY PER U.S. S Tue Fri .3997 1.9218 15.492 3770 .001504 1208 0004345 .6974 1.5596 1.5802 1.5612 1.5518 564.85 8.2768 2306 25 9973 1.5859 15 093 3770 44.2489 2.5640 6877 5884 6903 .6924 1.5505 1:55:2 1.5623 1.5630 564.75 8.2769 2301.75 Country Japan (Yen)... 1-month forward. 3-montis funward 6-months forward Jordan (Dinar)... Kuwait (Dinar).... Lebanon (Pound). Malaysia (Ringgi)-b.... Con mchana Jeg Malta (Lira).. Mexico (Peso)... Floating rate. Netherlands (Guider).. New Zealand (Dollar)... Norway (Krone) Pakistan (Rupee) Peru (new Sal). Philippines (Peso). Poland (Zloty)-d... Portugal (Escudo).. Russia (Ruble)-a.. Saudi Arabia (Riyal).. wa ** maire Singapore (Dollar). Slovak Rep. (Koruna). South Africa Rand)..... South Korea (Won).... Spain (Peseta). new **** www. U.S. $ EQUIV Tue 016392 C064119 038466 .008539 $19.16 118.77 118 12 117.10 .7092 3.2767 .3050 0006604 0006505 151425 2632 2632 3.8001 2.2193 2.2533 4506 14100 3.2733 1086 1086 4031 4137 4401 1132 .01564 2874 01961 2359 4320 1120 .01564 2871 Fri 08420 008445 008493 008563 14100 31855 2347 .C34431 13393 304548 03398 2667 2000 5726 32049 1:80 0007806 CC07813 C15338 305479 CURRENCY PER U.S.S Tue Fri 5796 02100 196 9.2100 2.4810 2.3148 8.9272 63.950 3.4535 $1.15€ 4.2605 225.70 29.469 3.7500 F.7465 48.793 8.4720 1281.00 187.32 118.76 118.41 117.75 116.78 .7092 3050 1514.00 3.8000 4438 9.2050 2.4171 22722 8.8369 63.950 3.4795 51.000 4.2392 219.90 29.425 3.7491 1.7403 47.609 B.4331 1280.00 182.50
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Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780072553079
6th Edition
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
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