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# process of Investment Bonds, Municipal Bonds, CDs, etc,

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The firm has \$150,000 to invest in the spot, forward, or options markets.
The spot rate is \$1.2622 to the euro, and in 12 months, the forward rate is \$1.2905 to the euro.
However, this leader is sure that the exchange rate in 12 months will be \$1.33 to the euro.
Explain how she can speculate on the belief that the euro will be \$1.33 in 12 months.
Calculate the amount of profit (ignoring exchange rate fees) that will be earned and the percentage return achieved.

2. I have already calculated the numbers for purchasing the Euros at a spot rate detailed here:

The simply method of taking advantage of the belief that the exchange rate will be \$1.33 per euro next year is as follws:

Purchase euros at the spot rate \$150,000/1.2622 = ?118,840.12 euros

And then hold for 1 year

Then convert the euros back to dollars at \$1.33 X 118,840.12 =\$158,057.35

Profit is \$158,057.35 - \$150,000 = \$8,057.35

Return on investment is (\$8,057.35/\$150,000) X 100 = 5.37%

3. Now, the instructor has made a comment that there may be other investments in bonds, municipal bonds, CDs, etc that offer much lower risk that can pay equal or a higher return.

4. This is where I need assistance. Please explain the process of Investment Bonds, Municipal Bonds, CDs, etc,

5. Explain which might be a better choice (other than my spot option in number 2) based on our scenario.

6. Please cite all references used.

Thanks!

https://brainmass.com/economics/contracts/process-of-investment-bonds-municipal-bonds-cds-etc-257767

#### Solution Preview

A debt instrument is a paper or electronic obligation that enables the issuing party to raise funds by promising to repay a lender in accordance with terms of a contract. Types of debt instruments include notes, bonds, certificates, mortgages, leases or other agreements between a lender and a borrower.

Bonds: In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest (the coupon) and/or to repay the principal at a later date, termed maturity. A bond is a formal contract to repay borrowed money with interest at fixed intervals.

Notes: A promissory note, referred to as a note payable in accounting, is a contract where one party (the maker or issuer) makes an unconditional promise in writing to pay a sum of money to the other (the payee), either at a fixed or determinable future time or on demand of the payee, under specific terms.

Municipal Bonds: A municipal bond is a bond issued by a city or other local government, or their agencies. Potential issuers of municipal bonds include cities, counties, redevelopment agencies, ...

#### Solution Summary

A debt instrument is defined.

\$2.19

## Annual reports for quoted company for last 4 years starting from 2005 to 2004

Annual reports for quoted company for last 4 years starting from 2005 to 2004
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I need annual reports for a company which are ( US or UK based) for last 4 years starting 2005 or 2004 provided no major sale/acquisition or merger has taken place in the last 4 year period. I would prefer if you could provide me with annual reports which are simple and easy to understand.( Excluding minority interest etc.)

1) Also required is the calculation of various ratios to measure liquidity, profitability, efficiency, gearing etc for the 4 years

2) Explanation for changes in ratios over the period also required ( about 2000 words)

3) Copies of complete annual report also required
This is required by me to do my assignment on financial analysis explaining the profitability , liquidity ,gearing and efficiency ratios.

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