Suppose that you have U.S. $1,000,000 to invest in the market. Considering the following information, you...

Suppose that you have U.S. $1,000,000 to invest in the market. Considering the following information, you have decided to engage in triangular arbitrage. What is your profit from triangular arbitrage? Value of Australian dollar in U.S. dollars = U.S. $ 0.90 Value of New Zealand dollar in U.S. dollars = U.S. $ 0.30 Value of Australian dollar in New Zealand dollars = NZ $ 3.02 A. $8,255 B. $1,008,255 C. $6,667 D. $1,006,667 E. $4,111

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jeff jeffy answered 2 years ago

Suppose you have developed the following information for a potential investment: current market value is $1,000,000;...

Suppose you have developed the following information for a potential investment: current market value is $1,000,000; anticipated loan to value ratio is 0.75 with two discount points; and predicted cash flows of ATCF1 = 38,560, ATCF2 = $41,780, ATCF3= $45,210, and ATER3= $201,730. Assume the investor's minimum required after-tax rate of return is 15%. What is the net present value is investment? -$37,511 2) -$22,511 3) $62,280 4) none of the above The Tax Act of 1993 raised the marginal...

You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-euro exchange rate is quoted as...

You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-euro exchange rate is quoted as $1.12 = €1.00 and the dollar-pound exchange rate is quoted at $1.28 = £1.00. If a bank quotes you a cross rate of £1.00 = €1.16, the intrinsic value for the cross rate is _________.

Assume the following information: U.S. investors have $1,375,000 to invest 1-year deposit rate offered on U.S....

Assume the following information: U.S. investors have $1,375,000 to invest 1-year deposit rate offered on U.S. dollars = .12 1-year deposit rate offered on Singapore dollars = 0.105 1-year forward rate of Singapore dollars = $0.412 Spot rate of Singapore dollar = $0.40 interest rate parity doesn’t exist and covered interest arbitrage by U.S. investors results in a yield of _______ which is above what is possible domestically

You are given the following information. What is the arbitrage profit if you have €1,000,000 to...

You are given the following information. What is the arbitrage profit if you have €1,000,000 to use? Bid Ask S(SEK/€) 10.4091 10.4286 S(£/€) 0.9115 0.9127 Cross-rate S(SEK/£) 11.4021 11.4042

You are given the following information. What is the arbitrage profit if you have £1,000,000 to...

You are given the following information. What is the arbitrage profit if you have £1,000,000 to use? (£ = British Pound; ZAR = South Africa Rand; DKK = Danish Krone) S(ZAR/GBP) 21.1305 S(DKK/GBP) 8.7171 S(DKK/ZAR) 0.3785

Suppose that you are the FX trading desk of ExxonMobil with an extra U.S. $1,000,000 to...

Suppose that you are the FX trading desk of ExxonMobil with an extra U.S. $1,000,000 to invest for six months. You are considering the purchase of U.S. T-bills that yield 1.810 percent (that's a six month rate) and have a maturity of 26 weeks. The spot exchange rate is $1.00 = ¥100, and the six month forward rate is $1.00 = ¥110. The 6-month interest rate in Japan (on an investment of comparable risk) is 13 percent. What is your...

Suppose you have developed the following information for a potential investment: current market value is $1,200,000;...

Suppose you have developed the following information for a potential investment: current market value is $1,200,000; anticipated loan to value ratio is .80 with 2 points; and predicated cash flows of ATCF1 = $38,560, ATCF2 = $41,780, ATCF3 = $37,210, ATCF4 = $39,127, and ATER4 = $191,730. Further, assume the investor's minimum required after-tax rate of return on equity is 12%. a. What is the internal rate of return on this potential investment? b. What is the profitability index on...

A company will invest with an initial investment of $1,000,000. Assuming a market interest rate of...

A company will invest with an initial investment of $1,000,000. Assuming a market interest rate of 5% and cash flow for 5 years is expected in the table below: Year Cash Flow 1 425,000 2 384,000 3 321,500 4 282,500 5 200,000 Calculate the PAYBACK PERIOD and NPV!

1) Suppose that you have $10,000 to invest and the bank offer you the following options:...

1) Suppose that you have $10,000 to invest and the bank offer you the following options: A: Interest rate of 8.5% compounded quarterly. B:Interest rate of 8.3% compounded monthly. C:Interest rate of 822% compounded weekly. D: Simple interest rate of 15% a) Order the options from worst to best, if the term of the investment is 1, 3, 10 and 20 years. b) What is the minimum number of years required for options A, B and C to be more...

You are considering the purchase of an office building. You have gathered information, surveyed the market,...

You are considering the purchase of an office building. You have gathered information, surveyed the market, and made predictions. Assume you plan to purchase the property on January 1, 2020 and sell the property on December 31, 2024. Other assumptions: Total acquisition price: $931,000. Property consists of 10 office suites, 5 on the first floor and 5 on the second. Contract rents: 5 suites at $1,831 per month and 5 at $1,431 per month. Annual market rent increases: 2.31 %...

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