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Unformatted text preview: country 90-day annualized appreciate or forward premium depreciate? Canada _______ _______ Japan _______ _______ Switzerland _______ _______ U. K. _______ _______ 3. Using the handout calculate the cost of buying 500,000 Australian dollars on the second Thursday in December if the price is locked in with a futures contract. 4. Effective exchange rates are used to compare the price of foreign currency in general over time. The average value of the spot rates observed in foreign currency markets for 1990 were: 1.1668 Canadian $ per U.S. $ 1.0455 ECU (now euro) per U.S. $ 144.79 Japanese per U.S. $ 1.7847 U.S. $ per British Using the following weights calculate the effective exchange rate for the U.S. at the date used in question 1. Canada 11.7% Euro Area 55.3% Japan 17.6% U.K. 15.4% Effective exchange rate (1990 base year) is: Did the general cost of foreign currency rise or fall between 1990 and the present?...
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This note was uploaded on 02/29/2012 for the course ECON 459 taught by Professor Phillips,k during the Winter '08 term at BYU.
- Winter '08