Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. assume carlton enters into a three-year fixed-for-

Assume Carlton enters into a three-year fixed-for-fixed swap agreement to receive Swiss Franc and pay...

60.1K

Verified Solution

Question

Finance

Assume Carlton enters into a three-year fixed-for-fixed swap agreement to receive Swiss Franc and pay U.S. dollars annually, on a notional amount of $3,000,000. The spot exchange rate at the time of the swap is SF0.8/$.
Assume that one year into the swap agreement, Carlton decides it wishes to unwind the swap agreement and settle it in dollars. Assuming that a two-year fixed rate of interest on the Swiss Franc is now 2.59%, and a two-year fixed rate of interest on the dollar is now 5.90%, and the spot rate of exchange is now SF0.56/$. To Carlton, what is the swap agreement's net present value (in dollars)?(Keep the sign and two decimal places.)
\table[[,Euro-,Swiss franc,U. S. dollar,Japanese yen,],[Years,Bid,Ask,Bid,Ask,Bid,Ask,Bid,Ask],[2,3.08,3.12,1.68,1.76,5.43,5.46,0.45,0.49],[3,3.25,3.29,2.12,2.17,5.54,5.59,0.56,0.59]]
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

If you make 34 800 and get 1200 raises each year in how many years...

Finance
1.2K views

Describe the three (3) primary methods of cost allocation and describe how they differ.

Advance Math
1.2K views

Better Fitness, Inc. (BFI), manufactures exercise equipment at its plant in Freeport, Long Island. It recently...

Accounting
1.2K views

Linkin Corporation is considering purchasing a new delivery truck. The truck has many advantages over the...

Geometry
1.2K views

3 6 Question 10 10 points G H CON If m GHI measure of J...

Basic Math
1.2K views

Sir Toby These clothes are good enough to drink in so be these boots An...

Basic Math
1.2K views

A cylindrical jelly jar is 9 inches across the top and about 12 inches high....

Statistics
1.2K views

Researchers watched dolphin groups off the coast of Ireland in 1998 to determine what activities...

Algebra
1.2K views

Solve the inequality using a graph Round your answer to four decimal places 7 3...

Algebra
1.2K views

11 1 point Calculate the slope of the line graphed below 2 3 2 3...

Accounting
1.2K views

Arnez Company's annual accounting period ends on December 31 . The...

Accounting
1.2K views

Corbett Pharmaceuticals manufacturers an? over-the-counter allergy medication. The company sells both large commercial containers of?...