Final answer:
To calculate the next payment for a currency swap involving $10 million and SF15 million, we use the formula for future value and the present value of each currency at their respective fixed interest rates. By doing the calculations, we can determine the next payment each party makes.
Step-by-step explanation:
For a currency swap involving $10 million and SF15 million, one party pays dollars at a fixed rate of 9% and the other party pays Swiss francs at a fixed rate of 8%. Since the payments are made semiannually based on the exact day count and 360 days in a year, we need to calculate the next payment for each party.
To calculate the next payment, we can use the formula for future value. For the party paying dollars, the future value would be the present value of $10 million compounded at a rate of 9% for the number of days in the current period divided by 180 (since interest is paid semiannually). Similarly, for the party paying Swiss francs, the future value would be the present value of SF15 million compounded at a rate of 8% for the same number of days divided by 180.
By plugging in the values and doing the calculations, we can determine the next payment each party makes.