Given the Following Information for a 90 Day Contract What Will Be the Forward Rate?
A)1FC =

question 55

Multiple Choice

Given the following information for a 90 day contract: ?

$$\begin{array}{l}\begin{array} { l c c } & \text { US Dollars } & \text { FC } \\\text { Value Today } & 3,750 & 5,000 \\\text { Interest Rate } & 4 \% & 7 \% \\3 \text { months interest } & 37.50 & 87.50 \\\text { Value in 3 months } & ? ? & ? ?\end{array}\\\text { The spot rate today is } 1 \mathrm { FC } = .75\end{array}$$ What will be the forward rate?

• A)1FC = .75 US Dollars
• B)1FC = .57 US Dollars
• C)1FC = .745 US Dollars
• D)1FC = .70 US Dollars

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Definitions:

Structural Variables

Aspects of an organization's setup, such as its hierarchy, departmentalization, and distribution of authority, that influence its functioning and culture.

Managerial Strategy

The set of actions, plans, and policies devised by management to achieve competitive advantage and meet organizational goals.

Differentiation

The process of distinguishing a product or service from others to make it more attractive to a particular target market.

Cost

The amount of money required to purchase something or the expense associated with producing a service or carrying out a project.