Forward Contracts: Calculate the Gain or Loss to the Holder and to and to the Writer

question 11

Essay

Forward Contracts:
Calculate the gain or loss to the holder and to the writer of the forward contract who agrees to buy foreign currencies
at a specific price.Assume that on May 1, the writer of the forward contract agrees to sell 3,000,000 foreign currencies at a specific price of $0.22 per foreign currency (FC) with delivery in 30 days (May 31).Assume the spot rate at the end of the forward period is $0.20.
What is the entry to the holder on May 1.
Explain how the value of the forward contract changes over time.

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Definitions:

Main Androgen

Testosterone, the primary male sex hormone responsible for the development of male physical characteristics.

Spermarche

The onset of the ability to ejaculate in males, which typically occurs during puberty and represents a significant marker of sexual development.

Testosterone

A steroid hormone that plays a key role in the development of male reproductive tissues and secondary sexual characteristics.

Sex Chromosomes

Chromosomes, specifically the X and Y, that determine the genetic sex of an organism, playing a key role in sexual differentiation.