Solution-Was the british pound selling at a discount or

Was the british pound selling at a discount or premium

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Reference no: EM13939813

About three years ago,the following spot and forward rates for the British pound ($/£) were reported:

Spot.........$1.525
30-day forward......$1.522
90-day forward......$1.520
180-day forward....$1.514

a.Was the British pound selling at a discount or premium in the forward market?

b.What was the 30-day forward premium (or discount)?

c.What was the 90-day forward premium (or discount)?

d.Suppose you executed a 90- day forward contract to exchange 100,000 British pound in to U.S. dollars. How many dollars would you get 90 day's hence?

Reference no: EM13939813

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Was the british pound selling at a discount or premium

Reference no: EM13939813

Reference no: EM13939813

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