hi...
i need the solutions of these questions-
financial, treasury and forex management
test paper 3/2008
Q2 (b) Shares of Resham Ltd. are currently selling at Rs. 47. Estimate the value of a call with strike price of Rs. 50 and expiring six months later. The risk less interest rate is 10% and the standard deviation of returns on the stock is 0.40 per year. Also find out the value of options on the same stock with identical strike price and expiry using the Black Shales Model.
Q3 (b) On March 30, 2008 a customer in Mumbai requested a bank to remit DG 250000 to Holland in payment of import of diamonds under an irrevocable LC.However,due to bank strikes, the bank could affect the remittance only on April2,2008. The interbank market rates were as follows:
March 30, 2008 April 2, 2008
Mumbai $/Rs. 100:3. 15-3.10 3.12- 3.07
London $/£ : 1.7250/60 1.7175/85
DG / £ 3.9575/90 3.9380/90
The bank wishes to retain an exchange margin of 0.125%.How much does the customer stand to gain or lose due to the delay?
CAclubindia
