Question: asap please!!! Assignment 1: A Tunisian exporter is expecting an income of 2M USD in 3 months. In order to hedge his forex risk, he
Assignment 1: A Tunisian exporter is expecting an income of 2M USD in 3 months. In order to hedge his forex risk, he enters in a contract with his bank to pledge the risk. On the bank's side, there are two forward exchange rate techniques: Forward outright and Currency swap Market conditions: SUSD TND: 3.0031 - 49 USD Interest rates (3 months): 11% 1 12% TND Interest rates (3 months): 2 18% - 2 378 % 1) What will be the forward outright exchange rate applied by the bank borrowing and lending interest rate commissions on Local Monetary Market are respectively 1/8% and 3/8% and that the bank wants to make a profit of 1.000 IN ON this exchange transaction? 2) If the bank chooses the currency swap technique, a. Present the first Bank flow statement considering a profit of 1.000 IND and USD/TND swap points partner bank quotations=62-57? b. What will be the 3 month forward exchange rate communicated to the exporter! Which forward exchange technique is better for the exporter
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