quiz_2_vb_solutions[1]

# quiz_2_vb_solutions[1] - Version B Fin 536 Quiz 2 Solutions

This preview shows pages 1–2. Sign up to view the full content.

Version B Fin 536 Quiz 2 Solutions Name____________________Section_4pm/7pm 1. (5pts)Fill out the answers. a. Two banks quotes the following rates at the same time: Citibank NY quotes ¥105.34- 105.44/€ and Barclays London quotes ¥107.56-107.78/€. The ask prices of € from Citibank is _____105.44/€ ____ and the ask price of ¥ from Barclays is __¥107.56/€ ___. We can profit from buying __ euro ___(euro/yen) from Citibank and sell the ____euro ___(euro/yen) to Barclays. The profit will by ¥___2.12__ __ per euro. b. Three banks are quoting the following rates: Citibank quotes ¥85/\$; UBS quotes \$1.29/€; Deutsche Bank quotes ¥112/€. If you start with \$2000, your profit will be \$___42.86 ______from the triangular arbitrage. c. The exchange rate between Mexican peso and U.S. dollar was peso 8.8/\$ in Jan 2009 and peos10/\$ in Jan 2010, then Mexican peso has __ depreciated ______ (appreciated/depreciated) against peso by ___12 ____% during the year. d. A Big Mac costs ¥310 in Japan, while it costs \$3.5 in the U.S. The implied PPP exchange rate between yen and dollar is ¥___88.57_ _____/\$. If the actual market

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 09/06/2011 for the course FIN 536 taught by Professor Staff during the Spring '11 term at S.F. State.

### Page1 / 2

quiz_2_vb_solutions[1] - Version B Fin 536 Quiz 2 Solutions

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online