Question

In: Finance

Suppose the current spot rates are $.135/MXN bid and $.140/MXN ask, combined with current spot rates of €.775/$ bid and €.785/$ ask.

Suppose the current spot rates are $.135/MXN bid and $.140/MXN ask, combined with current spot rates of €.775/$ bid and €.785/$ ask. What are the MXN/€ bid and MXN/€ ask prices? (to 4 decimal places)

MXN/€ bid:

       MXN/€ ask

Solutions

Expert Solution

The bid price is computed as follows:

= ($ / € 0.785) x (MXN / $ 0.140)

= MXN 9.0992 / €

The ask price is computed as follows:

= ($ / € 0.775) x (MXN / $ 0.135)

= MXN 9.5579 / €

Please ask in case of any query

jeff jeffy answered 3 years ago
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