Answer:
c. Appreciate; Appreciate
Explanation:
Triangular arbitrage is the act of taking an opportunity resulting from a pricing discrepancy among three different currencies when the currency's exchange rates do not exactly match up
This cases are very rare and for a quite short period of time so there are very few traders who takes the advantange of them.
Lets study th given cases here:
A) NZ dollar Versus Mexican Peso
The exchage rate is 1NZ$= 2 Mexican Pesos (MXP)
But if we apply the triangular arbitrage:
1 NZ dollar = 0.3333 US$
and we know tha 1 US$= 7 Mexican Pesos (MXP
Then 1 NZ dollar = 0.3333* 7 MXP= 2.333 MXP
So the NZ dollar appreciates
B) MXP Versus U$S
The exchage rate is 1 MXP= (1/7) U$S
But if we apply the triangular arbitrage:
1 MXP = 0.5 NZ
and we know tha 1 NZ= 0.333 US$
Then 1 MXP = 0.5* 0.333 U$S= 0.166 U$S
So the MXP appreciates
Answer: Participation
Explanation:
Participation financing is a firm of financing whereby a loan is shared by several parties because such loans are too huge and a party cannot take the loan alone.
Since we are informed that works for a life insurance company that funds commercial investment projects and often insures these projects by insisting on an equity position, this means that participation financing is being practiced.
Answer:
Normal:
$ 3,509.7470
$ 563.7093
$ 2,000.00
Due:
$3,930.9167
$ 597.5319
$ 2,000.00
Explanation:
We solve using the formula for common annuity and annuity-due on each case:
(annuity-due)
<u>First:</u>
C 200.00
time 10
rate 0.12
Normal: $3,509.7470
Due: $3,930.9167
<u>Second:</u>

$563.7093
$597.5319
<u>Third:</u>
No interest so no time value of money the future value is the same as the sum of the receipts regardless of time or being paid at the beginning or ending.
1,000 + 1,000 = 2,000
Coupon rate is the yearly interest earned by a loan and it can be calculated with

where i is the annual interest and p is the par value of the bond or the initial loan amount.
For this particular case, since the semiannual payment is $28.50, then the annual payment is 2 x 28.50 = $57.00.
Thus, we have

From this, the coupon rate is 0.057 x 100% = 5.7%.
Answer: 5.7%
Answer:
$343
Explanation:
Andrea and Phillip's annual premium cost can be calculated using the cost per thousand formula:
cost per thousand = annual premium / thousands of coverage
- cost per thousand = $0.98
- thousands of coverage = $350,000 / $1,000 = 350
$0.98 = annual premium / 350
annual premium = $0.98 x 350 = $343