Assume that you are a retail customer (i.e., you buy at the ask and sell at the bid). Use the information below to answer the following questions.

Bid Ask APR

S0($/) $1.42=1.00 $1.45=1.00 i$=4%

F360($/) $1.48=1.00 $1.50=1.00 i=3%

1. If you borrowed $1,000,000 for one year, how much money would you owe at maturity?
2. If you had borrowed $1,000,000 and traded for euro at the spot rate, how many would you receive?
3. If you had 1,000,000 and traded it for USD at the spot rate, how many USD would you get?

Answer rating: 100% (QA)

To answer your questions lets analyze the provided information 1 Borrowing 1000000 for one year Base... View the full answer