Question

4. The exchange rate and forward rate of rupee against US dollar on 2019 December is given below:

Spot rate US dollar 1 = Rs. 71.50

1 month forward - 4.12%

3 month forward - 4.05%

6 month forward - 4.06%

You are required to

(a) Forward rate

(b) Forward premium​

Answer 1

4.12%
4.06%
+4.05%
————-
8.23%
—————

1$=Rs.71.50.