Financial Math Answers

Assume the following information: 90-day Ghana interest rate = 4% 90-day South African interest rate = 3% 90-day forward rate of South African rand = GHS 0.3500 Spot rate of South African rand = GHS 0.3550 Assume that the Osei Bonsu Co. in Ghana will need 300,000 rand in 90 days to pay for imports from South Africa. It wishes to hedge this payables position. Would it be better off using a forward hedge or a money market hedge? Substantiate your answer with estimated costs for each type of hedge.

Ghana’s inflation is forecasted to be 10.2% over the coming year whilst that of South Africa is forecasted to be 6.5%. The current exchange rate between Ghana Cedi and the South African Rand is 0.32 ZAR per 1 GHS. a) How should we quote the exchange rate between Ghana Cedi and the South African Rand (ZAR) in a year’s time to avoid arbitrage? (5 marks) b) A Ghanaian company is importing goods worth ZAR 20m in a year’s time, how much GHS will the company require to import the goods? (5 marks) c) If the actual rate at the end of the year is 0.35 ZAR per 1GHS, what is the absolute forecast error for the forecast in (a)? (5 marks)

Mahesh wants to start his business and for that he decides that he will take loan for

Rupees 7 Lakhs from the Bank of Baroda. He also decides to use his saving worth 3 lakhs

in the bank account to start the business. Discuss how these two transactions will be

recorded in the books of accounts by passing the relevant journal entries? How these

transactions will be reflected in the Books of accounts (that’ is in the financial statements)?

Lastly, conclude your answer by stating the applicability of which accounting

assumption/s you did the above mentioned accounting treatment/ recognition and

presentation in the books of accounts.

"Please Only Give Me The Reference Of The Answer"

Calculate the simple interest earned on an investment of $1180 at 2% p.a. for 9 years. Give your answer to the nearest cent.

This pandemic situations has drawn the attention of a lot of individuals to actively watch

and participant in the Indian financial market. As a life-long learner, you also decide to

understand the fundamentals of certain companies listed on the stock exchanges in India.

One of your friends advised you to look in to the various techniques of financial analysis,

as one of the way of evaluating the financials of business entities. You are done with

getting an understanding about various techniques of financial analysis. Elaborate any five

of the said techniques for financial analysis.

Long answer

Cal Bank believes the US dollar will appreciate over the next five days from GHS 4.48 to GHS 4.50. The following annual interest rates apply:

Currency

Dollars Ghana Cedis

Lending Rate

7.10% 6.80%

Borrowing Rate

7.50% 7.25%

Cal Bank has the capacity to borrow either GHS 10 million or $5 million. If Cal Bank's forecast is correct, what will its dollar profit be from speculation over the five-day

period (assuming it does not use any of its existing consumer deposits to capitalize on its expectations

Heather deposited $100 at the end of every month into an RRSP for 5 years. The      interest rate earned was 5% compounded daily. What was the accumulated value of the RRSP at the end of the 5 years? Round to the nearest cent.