What is cross-rate of swiss francs to euros

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Reference no: EM132046593

1. Suppose that you manage a pension fund that has liabilities of $2 million, $4 million, $8 million, and $10 million coming due in 1, 2, 3, and 4 years, respectively. You want to invest in bonds whose cash flows will exactly match the liabilities. The following bonds are available: 1-year, 2-year, 3-year, and 4-year annual-coupon bonds selling at par; the yields (YTMs) are 1%, 2%, 3%, and 4%, respectively. What's the necessary dollar amount of investment in 1-year bond today?

$1.337 million

$1.229 million

$1.314 million

$1.327 million

2. Suppose the exchange rate between U.S. dollars and Swiss francs is SF 1.1679 = $1.00, and the exchange rate between the U.S. dollar and the euro is $1.00 = 0.9462 euros. What is the cross-rate of Swiss francs to euros (SF/Euro)?

Reference no: EM132046593

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