Table shows the 90-day forward rate on the South African rand. a. Is the dollar at a

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Table shows the 90-day forward rate on the South African rand.

a. Is the dollar at a forward discount or premium on the rand?

b. What is the annual percentage discount or premium?

c. If you have no other information about the two currencies, what is your best guess about the spot rate on the rand three months hence?

d. Suppose that you expect to receive 100,000 rand in three months. How many dollars is this likely to beworth?

Table shows the 90-day forward rate on the South African

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Principles of Corporate Finance

ISBN: 978-0077404895

10th Edition

Authors: Richard A. Brealey, Stewart C. Myers, Franklin Allen

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Question Posted: Dec 31, 2012 10:50 AM

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Table shows the 90-day forward rate on the South African rand. a. Is the dollar at a

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a The dollar is selling at a forward premiu...View the full answer

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