Question

Use information from the table below to calculate the 30-day, 60-day and 180-day discount or premium for the Mexican peso.

Spot: MXN 1 = $13.3694

30-day forward: MXN 1 = $13.3488

90-day forward : MXN 1 = $13.2219

180-day forward: MXN 1 = $13.1888

Answer 1

The 30‑day forward discount is ‑1.85%

The 90‑day forward discount is ‑4.41%

The 180‑day forward discount is ‑2.70%

Step-by-step explanation:

The 30‑day forward discount is: [($13.3488 ‑ $13.3694)/$13.3694] x 12 x 100 = ‑1.85%

The 90‑day forward discount is: [($13.2219 ‑ $13.3694)/$13.3694] x 4 x 100 = ‑4.41%

The 180‑day forward discount is: [($13.1888‑ $13.3694)/$13.3694] x 2 x 100 = ‑2.70%