Currency swap-calculate the next payment each party makes

Assignment Help Financial Management

Reference no: EM132041821

Consider a currency swap for $10 million and SF 15 million (Swiss francs). One party pays dollars at a fixed rate of 9% and the other pays Swiss francs at a fixed rate of 8%. The payments are made semiannually based on 180/360 convention.

Calculate the next payment each party makes. ?

Why are these payments less likely to be netted out than a plain vanilla interest rate swap ?

(No Excel.Show your work step by step)

Reference no: EM132041821

Questions Cloud

What is the expected rate of return on the stock investment : The expected rate of return on the T-bond investmetn is 7.5%. What is the expected rate of return on the stock investment?

What is the project payback and npv : Project L costs $45,000, its expected cash inflows are $15,000 per year for 12 years, and its WACC is 11%. What is project's NPV?What is the project's payback?

What is the value of the target firm to the bidding firm : Does the merger generate synergy? What is change in overall firm value from the merger? What is the value of the target firm to the bidding firm?

What are the different methods for achieving takeover : What are the different methods for achieving a takeover? What are some of the defensive tactics that firms use to thwart takeovers?

Currency swap-calculate the next payment each party makes : Consider a currency swap for $10 million and SF 15 million (Swiss francs). Calculate the next payment each party makes.

What is the current value of her winnings : Rita Gonzales won the $66 million lottery. What is the current value of her winnings?

After analyzing costs and forecasting revenue : Jose decides to open a restaurant. After analyzing costs and forecasting revenue he realizes he can earn about a 14% return on his investment.

Compute the new price of bond : Media Bias Inc. issued bonds 10 years ago at $1,000 per bond. The bonds have 20 years remaining until maturity. Compute the new price of the bond.

Debt payment in year is the book value plus interests : Given the value of debt today, the cost of debt (rD) is: hint: the promised debt payment in a year is the book value plus interests.

User Account

All Pages