The peso/Canadian dollar spot rate is C$.12/MP and the peso sells at a 3% forward premium....

Question

Question

The peso/Canadian dollar spot rate is C$.12/MP and the peso sells at a 3% forward premium. Find the current forward rate.

C$.1212/MP

C$.1164/MP

C$8.0989/MP

None of the above

business finance

Answer 1

Answer #1

1 MP = 0.12 C$

Forward rate 1 MP = .12 * (1+ 3%)

= $0.1236

The answer would be none of the above

Answer 2

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