PLEASE ANSWER ALL QUESTIONS & Show work 1. Which of the following transactions r
ID: 2723375 • Letter: P
Question
PLEASE ANSWER ALL QUESTIONS & Show work
1. Which of the following transactions represents a CREDIT item on the balance of payments? [I] Boeing sells new jet planes to Air Canada. [II] Six Flags has recently made the decision to build a theme park in Cape Town. [III] Maria Estes sent a check last month to a friend living in Panama as gift. [IV] Isabella Jones has just received a dividend check for a stock she holds in British Airways.
2.If $1.45 will buy one British pound sterling, how much British pounds do you need to buy $105 million U.S. dollars?
3. Unlike options contracts, futures contracts represent
an obligation to buy or sell the underlying asset
an obligation to buy but not to sell
a right but not an obligation to buy or sell
a right to sell but not to buy the underlying asset
a, b, c
a.an obligation to buy or sell the underlying asset
b.an obligation to buy but not to sell
c.a right but not an obligation to buy or sell
d.a right to sell but not to buy the underlying asset
e.a, b, c
Explanation / Answer
Answer to 1.
1, Boeing sells new jet planes to Air Canada.
Answer to 2.
British pound required = $ 105 mio/$1.45 = 72.41 mio Sterling pounds
3) a) an obligation to buy or sell the underlying asset
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