Exchange rate | Business & Finance homework help


You own and effect a chain of electronic provisions in Texas and you are regarding expanding your list to embrace tablet effort stations for mean businesses. There is simply one supplier of the disgrace of tab lets you would relish to accumulation in your provision, and that sturdy is located in Mexico. You bear researched the present defect and progressive rebukes among the U. S. and Mexico, as involved in Table-1:

TABLE-1

Spot Rate

30-Day Forward

90-Da y Forward

180-Day Forward

U.S. Dollar/Peso

1.7851

1.7052

1.8051

1.7555

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Peso/U.S. Dollar

?

?

?

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Questions:

  1. Complete the Peso/ U.S. Dollar row in Table-1 and teach your methodology.
  2. If you assent to pay 2-million pesos for 100,000 tablets at today’s defect rebuke, ho w ample would you pay in U.S. dollars?
  3. If you assent to pay 2-millio n pesos but abide 180 days and end up paying the 180-Day progressive rebuke, how ample would you be paying for the 100,000 tablets, in U.S. Dollars?

     4. Your competitors hawk the tablet for $41.20 and you must trace you consequence up from consume by at smallest 20% to gain a minimal improvement, should you buy the tablets today?  Teach your exculpation.

5. Should you abide to buy the tablets in 30 days at the present 30-day progressive rebuke? Teach your exculpations.