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# 1 If the Yen trading at a spot price of 111 yen to USD and...

# 1 If the Yen trading at a spot price of 111 yen to USD and the 1-year forward rate is 115 Yen to 1 USD? What is premium of discount of the Yen, relative to the USD?
1.   3.48% Discount
2.   3.48% premium
3.   3.60% discount
4.   3.60% Premium


# 2 Suppose that inflation next year is 8% in japan and 4% in the United States. If the current spot rate is JPY107 = USD1, what is the expected spot rate at the end of the year?
1.   JPY102.72 = USD1
2.   JPY103.04 = USD1
3.   JPY111.12 = USD1
4.   JPY111.82 = USD1


# 3    Suppose the one-year interest rate in the United states is 7%. What would you expect the interest rate to be in the UK, if expected inflation is 4% in the United states and 8% in the UK?
1.   5.19%
2.   7.93%
3.   9.08%
4.   11.12%

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jeff jeffy answered 2 years ago
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