7/21/2019 Exercise 2

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Question

A Malaysian exporter has today signed a contract to export 2,000 tons of material at US$100 perton per local currency. ayment is due t!o months after shipment and shipment is any time o"erthe next month.

#ate of exchange today isSpot %.&1''(%.&2&')ne month for!ard 0.2*c premium( 0.%1 premium+!o months for!ard 1.-c premium (2.1% premium+hree months for!ard 2.'0c premium( 2.& premium+he exporter co"ered his exchange ris for!ard today.

a/ alculate the for!ard rate to e gi"en.  & mars/

 / Shipment is made three !ees later and payment is recei"ed !ithin t!o months3

time. 4o!e"er, only $10, 000 is recei"ed ecause there is a slight defect inthe goods.Sho! the entries on the customer3s account !hen the money is recei"ed, ignoringcommissions. 5id the exporter enefit from the for!ard rate6

  +he rates on that day is  Spot %.&-'0(%.000  )ne month for!ard 0.'0c discount(0.''c discount.

mars/

7/21/2019 Exercise 2

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Question 2

A Malaysian importer has today signed a contract to import 1'00 tons of material at US$'0 perton per local currency. ayment is due one month after shipment and shipment is any time o"erthe next month.

#ate of exchange today isSpot %.&1''(%.&2&')ne month for!ard 0.2*c premium( 0.%1 premium+!o months for!ard 1.-c premium (2.1% premium+hree months for!ard 2.'0c premium( 2.& premium+he importer co"ered his exchange ris for!ard today.

a/ alculate the for!ard rate to e gi"en.  & mars/

 / Shipment is made three !ees later and payment is released !ithin one month time. 4o!e"er,

only $&0000 is paid ecause there is a slight defect in the goods.Sho! the entries on the customer3s account !hen the money is paid, ignoringcommissions. 5id the importer enefit from the for!ard rate6

  +he rates on that day is  Spot %.&-'0(%.000  )ne month for!ard 0.'0c discount(0.''c discount.

mars/