Question: 4.5 If 364 days ago a forward contract was signed by an individual who promised to deliver $5,000 for 600,000 yen tomorrow. And if

4.5 If 364 days ago a forward contract was signed by an

4.5 If 364 days ago a forward contract was signed by an individual who promised to deliver $5,000 for 600,000 yen tomorrow. And if today it seemed pretty clear that tomorrow when the contract matures, the spot exchange rate will be 100 yen to the $, and the 1-yr forward exchange rate tomorrow will be 110 yen per $, then what would be the value of that forward contract he signed last year?

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Answer i Last year signed contract was 5000 for 600000 yens ... View full answer

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