International Financial Management Exam Two Review (1) Page 1 International Financial Management Exam Two Review (1).pdf
International Financial
Management Exam Two
Review
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Page 1 of 42 2026-03-17
,International Financial Management Exam Two Review Page 2 International Financial Management Exam Two Review.pdf
The 90-day forward rate for the euro is $1.20, while the current spot rate of the euro is $1.16. What is the forward
premium or discount of the euro?
A. 4.00%
B. 3.45%
C. 3.33%
B
The 90-day forward rate for the British pound is $1.37, while the current spot rate of the pound is $1.33. What is the
annualized forward premium or discount of the pound?
A. 3.00%
B. 2.92%
C. 12.00%
D. 11.68%
C
Page 2 of 42 2 of 42 2026-03-17
,International Financial Management Exam Two Review Page 3 International Financial Management Exam Two Review.pdf
The spot rate of Canadian dollar is $0.80. The 90-day forward rate of Canadian dollar exhibits a 2% discount. What is
the 90-day forward rate of Canadian dollar?
A. $0.816
B. $0.784
C. $0.820
D. $0.780
B
A euro call option has an exercise price of $1.20, and the current spot rate of euro is $1.18. This euro call option is ____.
A. In the money
B. Out of the money
C. At the money
B
Page 3 of 42 3 of 42 2026-03-17
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A U.S. corporation has purchased currency call options to hedge a 50,000 pound payable. The premium is $0.03 and
the exercise price of the call option is $1.38. If the spot rate at the time of maturity is $1.40, what is the total amount
paid by the corporation if it acts rationally?
A. In the money; $70,500
B. In the money; $69,000
C. Out of the money; $1,500
D. In the money; $72,000
A
A U.S. corporation has purchased currency call options to hedge a 50,000 pound payable. The premium is $0.03 and
the exercise price of the call option is $1.38. If the spot rate at the time of maturity is $1.36, what is the total amount
paid by the corporation if it acts rationally?
A. $68,000
B. $69,000
C. $69,500
D. $70,500
C
Page 4 of 42 4 of 42 2026-03-17
International Financial
Management Exam Two
Review
Guidehttps://www.stuvia.com/dashboard!@_)#*)(@$)($@*($@)($@*_1 of 42
Page 1 of 42 2026-03-17
,International Financial Management Exam Two Review Page 2 International Financial Management Exam Two Review.pdf
The 90-day forward rate for the euro is $1.20, while the current spot rate of the euro is $1.16. What is the forward
premium or discount of the euro?
A. 4.00%
B. 3.45%
C. 3.33%
B
The 90-day forward rate for the British pound is $1.37, while the current spot rate of the pound is $1.33. What is the
annualized forward premium or discount of the pound?
A. 3.00%
B. 2.92%
C. 12.00%
D. 11.68%
C
Page 2 of 42 2 of 42 2026-03-17
,International Financial Management Exam Two Review Page 3 International Financial Management Exam Two Review.pdf
The spot rate of Canadian dollar is $0.80. The 90-day forward rate of Canadian dollar exhibits a 2% discount. What is
the 90-day forward rate of Canadian dollar?
A. $0.816
B. $0.784
C. $0.820
D. $0.780
B
A euro call option has an exercise price of $1.20, and the current spot rate of euro is $1.18. This euro call option is ____.
A. In the money
B. Out of the money
C. At the money
B
Page 3 of 42 3 of 42 2026-03-17
, International Financial Management Exam Two Review Page 4 International Financial Management Exam Two Review.pdf
A U.S. corporation has purchased currency call options to hedge a 50,000 pound payable. The premium is $0.03 and
the exercise price of the call option is $1.38. If the spot rate at the time of maturity is $1.40, what is the total amount
paid by the corporation if it acts rationally?
A. In the money; $70,500
B. In the money; $69,000
C. Out of the money; $1,500
D. In the money; $72,000
A
A U.S. corporation has purchased currency call options to hedge a 50,000 pound payable. The premium is $0.03 and
the exercise price of the call option is $1.38. If the spot rate at the time of maturity is $1.36, what is the total amount
paid by the corporation if it acts rationally?
A. $68,000
B. $69,000
C. $69,500
D. $70,500
C
Page 4 of 42 4 of 42 2026-03-17
