The Wall Street Journal reported the following spot and forward rates for the Swiss franc

ACCOUNTING

The Wall Street Journal reported the following spot and forward rates for the Swiss franc:

Spot……………………$0.7876
30-day forward………$0.7918
90-day forward……… $0.7968
180-day forward………$0.8039

a. Was the Swiss franc selling at a discount or a premium in the forward market?
b. What was the 30-day forward premium (or discount)?
c. What was the 90-day forward premium (or discount)?
d. Suppose you executed a 90-day forward contract to exchange 100,000 Swiss francs into U.S. dollars. How many dollars would you get 90 days hence?
e. Assume a Swiss bank entered into a 180-day forward contract with Citicorp to buy $100,000. How many francs will the Swiss bank deliver in six months to get the U.S. dollars?

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