The following table shows interest rates and exchange rates
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The following table shows interest rates and exchange rates for the U.S. dollar and the Philippine peso in 2007. The spot exchange rate is 47.46 pesos=$1. Complete the missing entries:
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Hi,
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1 month 3 months 1 year
dollar interest rate (annually compounded) 5.3 5.3 0.058
Peso interest rate (annually compounded) 4.15 2.424 4.95
Forward pesos per dollar 47.255 47.437 47.482
Forward premium on peso (% per year) 5.21 0.19 -0.046333347
Spot rate Peso/USD 47.46 peso/usd
Example calculation of forward pesos per dollar:
If the spot price for USD/PES = 47.46, then this means that 1 USD = 47.46 PESO.
The ...
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