Kizspy | Question: 23
(Choose 1 answer)
The €/$ spot exchange rate is $1.50/€ and the 120 day forward exchange rate is 1.45/€. The forward premium (discount) is
A. the dollar trading at an 8% premium to the euro for delivery in 120 days.
B. the dollar trading at a 5% premium to the Swiss franc for delivery in 120 days.
C. the dollar trading at a 10% discount to the euro for delivery in 120 days.
D. the dollar trading at a 5% discount to the euro for delivery in 120 days.
