How many forints is each dollar worth today

Reference no: EM13295989

Five years ago, your friend's Hungarian grandmother passed away, leaving your friend 2,218,500 Hungarian forints. For sentimental reasons, your friend did not spend the money but stored it in a large box under her bed. Now, your friend is beginning college and realizes the money can be used to defray expenses. Assuming your friend places the money in a US dollar account today with an APR of 10% and daily compounding, answer the following questions.

If your friend can withdraw $2,886.46 now and at the beginning of each of the next three years before depleting the account, how many forints is each dollar worth today?

If interest rates and exchange rates were the same five years ago as they are today, how much larger would your friend's annual withdrawals be if she had put the money in the bank immediately rather than storing it under her bed? (Hint: this is the difference between the revised and the original withdrawal amounts.)

Reference no: EM13295989

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