Calculate the home currency cost of financing

Assignment Help Financial Management

Reference no: EM132047292

Nintendo, a Japanese game manufacturer, takes out a loan with the following characteristics: loan amount = EUR 120 million, maturity = 180 days, rate = 4.6 percent (actual/ 360 simple interest). Nintendo does not wish to have exposure to EUR and seeks a forward contract. EURJPY forwards of 180 days are quoted at a discount of 2 percent from the spot value of 160.

Calculate the home currency cost of financing assuming the use of the forward. Format x.xx%

Reference no: EM132047292

Questions Cloud

Describe major diversity trends facing organizations : Describe two of the major diversity trends facing organizations today and how organizations might use various OD interventions in response to these trends.

Annually into life insurance fund : You deposit $10,000 annually into a life insurance fund for the next 12 years, what will be the amount in the retirement fund at the end of year 12?

Identify initial amount of capital invested or put at risk : When engaged in international capital budgeting, the analyst must identify the initial amount of capital invested or put at risk.

What could have improved your learning experience : For its 2017 Training Industry Report, Training (2017) surveyed more than 300 U.S.-based corporations and educational institutions with 100+ employees.

Calculate the home currency cost of financing : Calculate the home currency cost of financing assuming the use of the forward.

Calculate foust cost of common equity : Calculate Foust's after-tax cost of debt. Calculate Foust's cost of common equity.

How capital one and other companies used mobile devices : Read the article Just-in-Time Training (Agnvall, 2006), which you can access through the link below. It describes in detail how Capital One and other companies.

Forecast the firm additional funds needed : the CEO of the Smith Group, is initiating planning for the company's operations next year, and he wants you to forecast the firm's additional funds needed (AFN)

Calculate the all-in cost : The loan is for a period of 180 days with a stated rate of 6.4 percent computed as simple interest on an actual/ 360- day basis. Calculate the all-in cost.

User Account

All Pages