Answer to Question #263901 in Economics for Anuja

Question

Given that the USD-INR spot rate is 74.28

calculate

a) the 90days forward USD- INR exchange rate,given that the

• *90 days risk free interest rate in US is 1%
• *90 days risk free interest rate in INDIA is 6%

b)the 180 days forward USD-INR Exchange rate given that the

• 180 days risk free interest rate in US is 1%
• 180days risk free interest rate in INDIA is 6%

c) if the risk free interest rate in the US remains same, while the interest rate in INDIA increases by 50bps, how would the calculations in a) & b) change.

Answer 1

Dear Anuja, your question requires a lot of work, which neither of our experts is ready to perform for free. We advise you to convert it to a fully qualified order and we will try to help you. Please click the link below to proceed: Submit order