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5 April, 10:24

In September 2009 a U. S. investor chooses to invest $500,000 in German equity securities at a then current spot rate of $1.30/euro. At the end of one year the spot rate is $1.35/euro. Refer to Instruction 13.1. How many euros will the U. S. investor acquire with his initial $500,000 investment?

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  1. 5 April, 12:55
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    Euro 370,370.37

    Explanation:

    The amount of Euros he will be able to acquire at the end of the year is equal to

    Amount to invest / spot rate at the date

    At the current spot rate of $1.35/euro

    Euros to acquire = 500,000/1.35

    = Euro 370,370.37
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