Solution-Determine the initial exchange of cash

Determine the initial exchange of cash

Assignment Help Finance Basics

Reference no: EM131387798

Consider a currency Swap in which the domestic party pays a fixed rate in the foreign currency, the British pound and the counterparty pays a fixed rate in U.S. dollars. The notional principals are $50 million and pound30 million. The fixed rates are 5.6% in dollars and 6.25% in pounds. Both sets of payments are made on the basis of 30 days per month and 365 days per year and the payments are made semiannually.

a. Determine the initial exchange of cash that occurs at the start of the swap.

b. Determine the semiannual payments.

c. Determine the final exchange of cash that occurs at the end of the swap.

d. Give an example of a situation in which this swap may be appropriate.

Reference no: EM131387798

Questions Cloud

Does a contract exist between conroy and blackburn : Conroy has demanded delivery of the goods according to the terms of the offer of November 23, but Blackburn has refused. Does a contract exist between Conroy and Blackburn? Explain.

Devise three learning objectives related to the project goal : EDU543- Devise three learning objectives related to the project goal. Identify technology that you plan to use, and suggest the strategy for its integration. Describe, the manner in which you plan to integrate technology into the activiti..

Write an essay about the special populations : There are various considerations that must be taken into account when initiating drug therapies in a geriatric, pediatric, or pregnancy patient. In a well-developed essay, discuss one to two key factors/elements that must be taken into considerati..

Provide the result in given situation : Henry and Wilma now wish to void the contract, asserting that they did not realize the exorbitant price they were paying. Result?

Determine the initial exchange of cash : a. Determine the initial exchange of cash that occurs at the start of the swap. b. Determine the semiannual payments. c. Determine the final exchange of cash that occurs at the end of the swap.

Do the parties have a contract : Courts believe that the wholesale market price of the refrigerators is only $120,000. Do the parties have a contract? If so, what is the price? Explain.

What is the breakeven sales level : A company is currently selling 500 units of a product per day at $10 per unit. What is the breakeven sales level for a 12 percent price increase

Identify and evaluate any recent research findings : Indicate one nationally or internationally recognized treatment guideline for the condition (if application); First line, second-line, third-line treatment options.Identify and evaluate any recent research findings (within the fast five years) abo..

Difference between a strategic vs a financial plan : What is the difference between a strategic vs a financial plan? How do they work together?

User Account

All Pages

Determine the initial exchange of cash

Reference no: EM131387798

Reference no: EM131387798

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Financial reporting and analysis

A report on financial accounting

Describe the types of financial ratios

Differences between sole proprietorship and corporation

Prepare a cash budget statement

What are the implied interest rates

State pricing theory and no-arbitrage pricing theory

Small business administration

Effect of financial leverage

Evaluate the basis for the payment to the lender

Importance of opps, ipps, mpfs and dmepos

Time value of money

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT