Question
A BBB bank expects NZD to appreciate from USD 0.50 to USD 0.55 over 5 days. US borrowing = 8% p.a., US lending = 6% p.a.; NZ borrowing = 4% p.a., NZ lending = 2% p.a. The bank executes an arbitrage strategy. Net profit as % of funds deployed over 5 days is approximately:
Note: Rate selection: Borrow at US BORROWING rate (bank’s cost = 8%); invest at NZ LENDING rate (bank’s earning = 2%). Do not confuse borrowing and lending rates.More Research Questions
- Which of the following statement is correct? 1. If autoregressive parameter (p) in an ARIMA model is 1, it means that there is no auto-correlation in the...
- If the expected value of the error is not zero, it is a problem only if this expected value is
- A "Pigouvian tax" is designed to correct for:
- The principle of "Ability to Pay" in taxation is most closely associated with:
- Under the modified Pradhan Mantri Matsya Sampada Yojana (PMMSY), the government has introduced a specific sub-scheme to support micro-enterprises. What is ...
- A subsidy can actually cause the consumption of a subsidized good to fall if
- A firm practices third-degree price discrimination by charging different prices to two distinct consumer groups based on their willingness to pay. The firm...
- Match the following
- Calculate the GDP at Market Price from the following data (in ₹ Crores): Private Final Consumption Expenditure: 8,000 Government Final Consumption Ex...
- For a monopoly firm, which of the following equalities is always true?
Hey! Ask a query
Please enter email id
The email must be a valid email address.
Please enter Mobile Number
Please enter valid Mobile Number
Please enter your Doubt
Think You're Ready for RBI Grade B?
RBI Grade B 2026 Phase 1 Memory Based Paper
- 200 Questions with Detailed Solutions
- Section-wise Coverage (GA, English, Quant & Reasoning)