81. the forward rate of the swiss franc is $.50. the spot rate of the swiss franc is $.48. the following interest rates exist: u. s. switzerland 360-day borrowing rate 7% 5% 360-day deposit rate 6% 4% you need to pay a sum of sf200,000 in 360 days. if you use a money market hedge, the amount of dollars you need in 360 days is:

(a) $101,904
(b) $101,923
(c) $98,769
(d) $96,914
(e) $92,307

invest  = $96,914

so correct option is d. $96,914

Explanation:

given data

forward rate of the Swiss franc = $.50

spot rate of the Swiss franc = $.48

pay a sum = SF200,000

solution

we know Borrow is here

Borrow =  

Borrow = SF190,476

and

when we convert it will be

Convert SF190,476 is

Convert  = SF190,476  × $.48 = $91,428

so investment at 6 % is

Invest = 6 % of $91,428 + $91,428

invest = $5485.68 + $91,428

so

invest  = $96,914

so correct option is d. $96,914

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answer///supply is elastic, and demand is inelastic;