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uysha [10]
3 years ago
12

Andreas Broszio​ (Geneva). Andreas Broszio just started as an analyst for Credit Suisse in​ Geneva, Switzerland. He receives the

following quotes for Swiss francs against the dollar for​ spot, 1 month​ forward, 3 months​ forward, and 6 months forward. Spot exchange​ rate: Bid rate SF1.2573​/$ Ask rate SF1.2599​/$ ​1-month forward 10 to 15 ​3-months forward 14 to 22 ​6-months forward 20 to 30 The current​ one-year U.S.​ T-Bill rate is 4.1%. a. Calculate outright quotes for bid and ask and the number of points spread between each. b. What do you notice about the spread as quotes evolve from spot toward 6​ months?
Business
1 answer:
Law Incorporation [45]3 years ago
6 0

Answer:

The answer is below

Explanation:

a) The spread is the difference between the ask and bid price, it is given by:

Spread = ask - bid

The outright quotes are given as:

1 - month forward:

Bid = 1.2573 + 0.0010 = 1.2583

Ask = 1.2599 + 0.0015 = 1.2614

3 - month forward:

Bid = 1.2573 + 0.0014 = 1.2587

Ask = 1.2599 + 0.0015 = 1.2621

1 - month forward:

Bid = 1.2573 + 0.0020 = 1.2593

Ask = 1.2599 + 0.0030 = 1.2629

                                                      Bid                             Ask                    Spread

1 - month forward:                         1.2583                      1.2614                 0.0031

3 - month forward:                        1.2587                      1.2621                 0.0034

6 - month forward:                        1.2593                     1.2629                 0.0036

b) The spread widen as it spot moves to 6 - month, this can lead to a thinner trading volume.

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The government would set its targeted interest at 6.5%

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R = π + A + 0.5(A-A*) + 0.5

This is the formula that helps to get the output gap

<u>Definition of terms</u>

R is the nominal federal funds rate

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When we enter the values into the formula

R = 2% + 3% + 0.5(3%-2%) + 0.5%(2%)

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Therefore the government would set its targeted interest at 6.5%

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5 0
2 years ago
The mangerial act of developing, implementing, and controlling marketing programs is called ___________.
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Answer: The correct answer is "the marketing management process".

Explanation: The mangerial act of developing, implementing, and controlling marketing programs is called the marketing management process.

The marketing process consists in analyzing the opportunities that the market offers us, researching and selecting the appropriate niches and designing and planning strategies.

The general marketing process in any company includes all the phases that it goes through until a marketing strategy is implemented, executed and evaluated, analyzing it from practically the moment it is born and it is just a simple idea.

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An educational institution that sells shares to investors to make money
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Incomplete question. Hence, In answered from a general economic perspective.

Answer:

<u>is having an IPO</u>

Explanation:

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Therefore, we can infer from the above statement that the educational institution was formerly privately owned, but since it started to sell its shares to investors so as to make money, it is having an IPO.

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3 years ago
During the current year, Morgan, Inc., had net income of $657,000. Morgan also recorded $203,000 in deprecation expense and had
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Answer:

$823,000

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If accounts receivable decreased, then it would be added.

If inventories increased, then it would be subtracted.

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3 years ago
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So, the total cost of the boquets of the flowers that worth 2$ each is given by,

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Total cost is defined as the total expense by the individual or a company added to the variable costs occur. Total cost help the businesses to calculate their profits and loss and maintain their sales data.

The terms fixed costs, total fixed costs, and variable costs have a similar sound, there are important distinctions among the three. The primary difference is that whereas variable costs and total fixed costs are heavily over dependent on the quantity of goods or services a company produces, fixed costs do not take that quantity into account.

To learn more about fixed cost, refer this link

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