Image of Faith in Islam Essay Example for Free

Image of Faith in Islam Essay This paper elucidates the meaning of faith in Islam and the image and branches related to it. The paper is based on the saying by Prophet Mohammad P. B. U. H regarding faith and the branches of faith. The seventy branches mentioned in the saying and the highest and lowest of these branches are discussed in this paper. The highest branch mentioned is to believe and say that there is no God but Allah and the lowest of these branches is to remove a harmful object from the path. Muslims follow this saying in various ways and this is reflected in other sayings from the Prophet and in the Quran. The meaning of faith has been depicted in various verses of the Quran and different sayings of the Holy Prophet P. B. U. H. Muslims follow this saying as an approach to carrying out the day to day functions of life. According to the saying by Prophet Mohammed P. B. U. H â€Å"Faith has over seventy branches, and modesty is a branch of faith† (Muslim, 1971). This meaning of faith for Muslims is very important as it provides them with a code of life. The number sixty or seventy does not mean an exact number of branches it just implies that in Islam the branches of faith are multiple. The highest branch is to say there is only one God frees a human being from worship to all other deities like idols, animals or any other being. This is the foundation of Islam which indicates there is no God but Allah and Muslims worship only one God. It should be noticed that modesty has been given special emphasis in the saying by the Prophet P. B. U.  H; it is mentioned because it provides protection against deeds like theft, adultery, abusive language and other such wrong doings (As-sidq. org, 2006). The Muslims lead their lives based on this very saying as the highest and lowest levels or branches of Islam are mentioned as the belief in one God and the removal of a harmful object from the path, this would mean anything between these branches is the code of life for the Muslims. This is symbolic to Islam as this provides the overall functionality of people who follow Islam. Islam is depicted as a religion of peace and harmony. If we consider the last branch which is the removal of a harmful object from the path signifies the wellbeing of other people who might use the same path at a later time. If this is the lowest branch then the higher branches would have more consideration for the well being of other people and this is the core of Islam. Islam is a religion symbolic of consideration and courtesy for others and all Muslims are regarded as brothers to each other. If all the Muslims have the same consideration for one another then Islam as a society would be an entity where people live to achieve harmony through cooperation and coordination.

Noughts and Crosses Essay -- essays research papers

Noughts and Crosses ‘Noughts and Crosses† by Malorie Blackman is a novel which follows the lives and experiences of two characters, Callum and Sephy. Throughout the book Blackman deals with a number of issues including relationships, alcohol abuse, power abuse, depression and violence. However, the key issues of the book are racism and prejudice. These issues of racism and prejudice are conveyed through the narrative techniques of characterization, point of view, language, structure and setting. The author uses language as a tool to show the characters’ status in society as black or white. Various language techniques are used to display the classes of society. The words â€Å"blanker† (used by blacks to describe whites) and â€Å"dagger† (used by whites to describe blacks) are used repeatedly throughout the novel. This use of language reflects the intolerant attitudes towards one another in Blackman’s radical world. There is a significant amount of symbolism used in these words. â€Å"Blanker† is used to describe a blank, worthless, brainless white person. And â€Å"dagger† is used to depict a weapon that is capable of scratching and severing, reducing and disconnecting a person, or even bringing them to an end completely. â€Å" I bet it was one of her blanker friends, they’re blank by name and blank by nature†. Through the difference of educated, formal language used by Crosses and the sometimes tasteless, simple lang uage of the noughts, the reader can see the grades in which noughts and Crosses are separately classed. Through this technique I believe Blackman is trying to show the extent to which racism can affect people. It can lessen, degrade and have heavy social affects on a person proving where they belong and what they will never be. The language is also used to emphasize the feelings and emotions of Callum and Sephy. The use of descriptive writing is employed by Blackman to give the reader insight into the effects and emotions of racism. â€Å"I was talking like my mouth was full of stones – and sharp jagged ones at that.† The book is full of descriptive writing and figurative language with use of similes and metaphors to explore the feelings of Callum and Sephy. The way in which Blackman uses these language techniques influences the reader to especially pity the white race and the way they are treated in the book. Blackman has created her own world to resemble our own op... ...fective in presenting both sides of their story accenting the differences in life standards, opportunities and rights. However Callum’s despair still affects Sephy, even when you are the wealthy daughter of a respected politician, Sephy will never be happy until she can be with Callum in an equal society. I think the authors values and attitudes are clearly shown through Sephy’s unhappiness. Blackman believes love and family to be more important than business, material goods, money and skin colour. Noughts and Crosses is an in depth story which explores the issues of racism and prejudice and the effects they can have on society. Blackman has created a world of her own in complete contrast to the society we live in. By doing this she has impacted her readers, challenged our contexts and allowed the reader insight into the effects of racism and the suffering it can cause. Blackman has effectively used a range of narrative techniques to bring her world to life giving the white reader a taste of the discrimination blacks have suffered for centuries, provoking feelings of empathy and understanding. By turning the world upside down, Blackman makes her readers see things more clearly.

Application of Ict in Classrooms in Rural Area Essay

Abstract This project discusses how class room education without ICT has become one of the major problems in rural area, to be specific Fufore local Government area in Adamawa state. Class room Education in rural area is not as effective as the ones in urban schools, because of their poor standard of learning, lack of communication, information, qualified teachers in rural schools and they lack ICT facilities to help them and provide awareness of modern standard of teaching. So, this project shows how implementation of ICT in class rooms can help these students, its benefits from implementation, challenges and also expectations from results. It involves how the state Government, private organisations and private sources will come together to make this success by providing the necessary materials, ICT services such as computer workstations, projectors, power supply via solar energy, trained computer experts that will show the school how to manage these resources, internet connectivity and basic infrastructure by the Government for these Fufore nursery/primary schools for better education and better knowledge of ICT and how it will greatly affect and have a positive influence to these students and finally this implementation will only benefit the students only but also the teachers who don’t have computer skills. Introduction This project is focused in implementing ICT in rural area, and the case study is on fufore local government in Yola. As we all know rural areas in Nigeria lack quality and basic education, when you talk about education in rural area what comes to our head is low standard of learning, poor education, not well equipped class rooms for student’s education or lack of proper infrastructure suitable for education. An article defined rural education as: There is little dispute that basic education1—often characterized as the reading, math, and other skills and knowledge taught in the first four years of primary school—is critical to economic and social development. Without basic skills, according to one definition, a person cannot comprehend the instructions on a bottle of medicine or a bag of fertilizer or read a government notice. Neither can the person compute a bill or write a letter. Without basic skills, it is impossible to develop one’s potential or to contribute in anything more than a rudimentary manner to society (Greaney, 1999). (Moulton, 2001) Fufore Local Government is settled area in the southern part of Adamawa with five major languages known as Fulani (largest), Bata, Verre, Laka and Pere, it consist of 1500 people that live there, most of them engage in cattle rearing, poultry, farming etc. When i went to observe these schools i noticed there were at least 300 children that went to both nursery and secondary schools, but the problem is they lack facilities that will make these students feel they are learning which makes some students even drop out of schools and start engaging in house work activities. This project focuses on schools in fufore that need ICT services to improve student’s knowledge and ability to learn in order for these schools to have equal education as the students in urban schools, if students in the rural area are not given equal education as students in the urban area there is a result of inequality. â€Å"Unequal tools in an unequal environment create unequal results† (Ukpe, 2010). Implementation/ Application of ICT in class rooms in rural area is going to benefit the society as a whole, and both the teachers and students. It goes a long way to help the society, because when students start using ICT in classrooms some of their friends at home will also find it interesting this will make them also want to start schooling and know what school is about. This study will also be used as a case study to many parts of rural areas in Nigeria, making them aware of how value ICT is in our generation and also making these local students to fit into any schools they find themselves in in urban schools because this implementation of ICT will  not only make these students concentrate on just computer and information studies they will also learn how to apply the knowledge in their various courses. Methodology In order to have reasons for the implementation of ICT in classrooms, i will have to compare this primary/secondary schools in rural area with the once in urban. The methods i used are personal observation, interview and online research (internet). We can see most urban schools have well functioned classrooms with well equipped IT services such as using projectors in class rooms, computers, wireless LANs, File management using databases. In order to convince these organisations we have to state the reasons why we think ICT is important for these locals in rural area. Just looking at an example of an urban schools such as Abti Academy in Yola, Capital science in kuje, El-Amin International school in Minna; we can see they all have what it takes for them to have a well knowledge of what IT is all about, they do class interactions, they submit their works in timely manner especially the senior students, it broadens their minds which they can relate to other courses and apply them when necessary, The students have full access to the lab to do research, take courses in computer education, type documents and gather information on relevant topics for their coursework and from every observation i noticed that schools in the urban area have high rankings in their external and internal exams such as mock exams, WEAC exams . In order to know what is really the problem of these schools towards their lack of ICT knowledge an interview was taken with most principals in these rural schools shown below. 1. Do you know what a computer is? 2. Do you intend to learn how to use it and do you intend to teach these students if you have the chance to? 3. Do you own a computer? And do you know how to surf on the internet with it? 4. What do you think about implementing ICT in classrooms? 5. How do you think it will affect the students? Interview Summary: Results  The interview was conducted with three different principals of three different areas in fufore, but all their answers were closely the same. They stated they’ve had an experience using a computer, that it would be great to have such an opportunity to use computers and other IT services in their schools, it will surely help the students and enlighten them about what the world is all about now. They stated that they’ve all being provided by the school with just one computer and an internet connection, and in a rural place like fufore I believe there is a limited amount of power supply which makes it even more difficult to use this computer by anyone. They stated students in their area are in need of ICT in classrooms in order to making teaching easier for both the teachers and students, they also have a problem with their teachers who don’t acquire computer skills, it will be difficult for them to teach and guide these students through. ICT will greatly affect and have a positive influence on these students, they will have an opportunity to be going for national competitions because these services will not only improve them in one area, they will also have the ability to speak proper and fluent English, they can also learn how to type by doing their course works on their computers and doing research on the internet which will even help the senior students in history classes. They also mentioned that students in this area are always willing to learn, so it won’t be a problem for them to get used to it. Development and Implementation of ICT in class rooms in rural area: Fufore LGA Through ICT in rural schools it will expand the access to student’s education, now that technology is one of the things that help us develop in this world. So we have to make the rural schools aware of that which will greatly affect both the students and their lectures, it will also make them aware of what is happening in our world today (News) by browsing on the internet, also help them improve interactions in terms of video conferencing and distance learning; through video conferencing it will enable to share ideas and know about other courses that are not offered in the school. ICT is an extensively strong technology for extending and expanding educational opportunities in formal and informal ways, in this case rural schools. ICT is a technological development that reflects the new society and has its place within education. However, as with many new initiatives, ICT obviously has its problems that over time will be addressed. Meantime, ICT should continue to be promoted to assist with education and learning. I will heartedly agree with anyone who states that ICT is a valuable tool for both teaching and learning – speaking as someone who got the last lessons plan for my teaching from the Internet- but I can’t help feeling that the emphasis on the use of ICT detracts from other current ‘sexy’ education issue – socialisation. I believe that developing teachers’ social and counselling technique is a greater priority than their ICT skill (Sime & Mark, 2005). Access to remote learning resources: when this implementation is done, with the use of internet, teachers and students will no longer have to depend on textbooks for learning or even buy them due to how expensive they can be, they teachers can just find textbooks on the net and direct the students to access them too. With the use of Internet services you will find a means of learning materials or tools in almost every subject and can be accessed every day at anytime and also by unlimited number of people that can use it. This is significant for many schools in developing countries. Students will have control towards self learning: For example, teachers can just give a research paper as an assessment for the students, during that research they also learn a lot through searching and browsing different articles. This also broadens their minds to also think fast, observe the situation of the research, allowing their minds to take over and have control of what they are doing and also making their own opinions and what they think. Motivation to learn: the use of multimedia computer software that include sound effects, pictures can be used in learning process for people in rural areas, also as interactive radios and other performance. This will motivate the locals to learn because it’s new to them and then i believe that some locals tend to understand pictures or graphics rather than reading them that way they understand better. Use of modern teaching tools: in rural areas they still have an old way of teaching their students; some don’t even have notebooks, or other writing materials. Through ICT, students can learn how to manage their files on computers rather than writing notes in their notebooks, also teachers have PowerPoint to present to the class by that they can just write short notes on what the teacher is talking about. In order to improve the school from my own point of view it needs these requirements for students to have a basic idea of ICT is about. 1. Provision of hardware resources for internet connectivity such as WAN, LAN, MAN. 2. Software packages for learning or academic related CDs which they can install in their computers to improve self learning. 3. Television for the nursery school students because children in nursery school learn faster with images rather than using books, and Projectors for the primary and secondary students. 4. A well functional and equipped computer that contains at least 15 computers. 5. Power supply via solar energy, because electricity isn’t that reliable and effective in rural areas, and besides this implementation is based in fufore which is always sunny every day. So solar would be a good source of electricity. These implementations can be done with the help of private organisations and even the government, we all know nothing is free; these organisations can get profit out of this successful implementation and project. They will keep implementing ICT and improving other schools in this area. Since i noted that not all teachers have enough computer skills to handle the students learning or to control these equipments, the organisations also have to supply the schools with well trained teachers/experts to show them how to take care of things just for some time. This is an expensive and vital project due to many resources that are needed, power supply because without power supply these resources are just going to end up being there without no one using it and also this is the future of our children to enlightened them and making them have a knowledge of IT, making them have the same and equal education the urban schools are having so they won’t feel left out. After these resources have been implemented and are already in use, in observation we are going to experience and expect these changes in the schools: †¢ The students should have the ability to think as fast and be smart like the students in urban schools and also their results will likely match up. †¢ An increase in the students that will enrol in schools because most students in rural areas don’t really care about education, some are drop outs and with a new system it will motivate them to also learn like their friends. †¢ Will be able to compete in national competitions with other schools. †¢ Know how to use these ICT services provided to them and also apply them when necessary Conclusion From all observations we can see how value education is and rural education cannot be compared to the urban because they have more experience in ICT than the locals have. ICT in class rooms has a lot of advantages and benefits to our daily life now, makes students acquire skills, skills that will take them to the next level, skills that will improve their way of thinking and will also change their lives because after school they can go to these urban areas and get a good job instead of staying in their area and doing the basic occupation such as farming. Technology is part of our world now and its used in our daily activities, with the aid ICT in class rooms they will have access to distance learning which will enhance their learning skills and ability, not only within the class room but globally or worldwide. In order for these students to be equal with students from other developed schools, they need to be given a chance; they need to be given the opportunities that are being given to the more fortunate schools/students. Nigerian Government, private organisations and private sources have to come together to make this possible for our generation and also to help the nation. References Ayaga, T. (2009, November 19). Fufore Area Council As Adamawa’s Development Pivot. Retrieved July 27, 2010, from all Africa. com: http://allafrica. com/stories/200911190399. html ICT in Education/The Promise of ICTs in Education. (2007, June 20). Retrieved July 27, 2010, from WIKIBOOKS: http://en. wikibooks. org/wiki/ICT_in_Education/The_Promise_of_ICTs_in_Education Moulton, J. (2001, January). Improving education in rural areas: Guidance for rural development specialists. Retrieved July 28, 2010, from http://www. tanzaniagateway. org/docs/Improving_education_in_rural_areas_guidance_for_rural_develo pment. pdf Sime, D. D. , & Mark, G. (2005). Student teachers’ firt reflections on ICT and Classroom Learning: implications for initail Teacher Education. Retrieved July 27, 2010, from https://dspace. stir. ac. uk/dspace/bitstream/1893/135/1/priestley-jcal-2005. pdf Tinio, V. L. (2002). ICT in Education. Retrieved July 26, 2010, from http://www. apdip. net/publications/iespprimers/eprimer-edu. pdf Ukpe, E. (2010, July 7). ICT in Education(Himself).

Speculative Trading Profits In The Foreign Exchange Market Finance Essay - Free Essay Example

Sample details Pages: 7 Words: 1954 Downloads: 4 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? Introduction Speculation in financial terms means an initial investment on which does not have any safety or there is significant risk of loss on investment. The term speculation is defined by Graham and Dodds which means buying share, equity, assets or debts without analysis which involves a significant risk. Others financial said purchase, holding, short-selling of financial instrument, derivatives, collectibles, stocks, commodities (oil and gold) , bonds to gains profits when fluctuations in its price. Don’t waste time! Our writers will create an original "Speculative Trading Profits In The Foreign Exchange Market Finance Essay" essay for you Create order Where as investment is a careful analysis of market and invests in order to obtain profits in long run as is a part of the holding company. The UBS, Deutsche Bank and Citigroup are the top foreign exchange dealers who reportedly earn per year from foreign exchange trading is over $1 billion. The profits of foreign exchange dealers are not necessarily due to speculative excess because most of trading in foreign exchange market is trading between banks. If one bank earns $1 billion then other bank lose $1 billion in foreign exchange trading. Interbank is zero sum game. The foreign exchange dealers are the market makers who trade with each other in order to adjust their range of price in response to buy and sell transactions from the corporate world and earn profits by providing liquidity in a market. Lets us carefully analysis about there earning is it through speculating trading or not by taking example of Citigroup. Suppose that 20% of all trading is between banks and their cus tomers. In 2004 Citibanks total market share was 7.50%. Hence if total volume in the foreign exchange market is $1.9 trillion, the volume of transactions per day handled by Citibank is .0750 X $1.9 trillion = $142.5 billion However 80% of these transactions involve other foreign exchange dealers and we assume that overall Citibank does not earn money on these deals. However, it does earn the bid-ask spread from dealing with corporate customer and other customers, which represents 20% of their market or .20 X $142,5 billion = $ 28.50 billion. if a typical bid-ask spread is 0.30% the profit potential from pure market making is $28.5 billion/day X  ½ X 0.30/100 X 250 trading days = $ 1069 billion / year ( International Financial Management , pp 55). They are number of reasons that Citigroups earn from liquidity service which it provide in foreign exchange market. Firstly we look the interbank spread for the major currencies in the spot market and we know that spreads wi th retail customer is higher than in the interbank market. Second Citigroup have a large market share in less liquid minor currency market for which the spread is much higher. Finally Forward contracts and other derivative contracts involve in foreign exchange trading but spreads are one of the larger part. After analyzing carefully its clear that bulk of Citigroup profits come from market making function not from speculative. It also conformed in study conducted by Amer and Brunner about foreign exchange dealer among United States commercial banks, that speculative trading was average source not major source of profit in foreign exchange trading. Conclusion Speculation is an initial investment for purchase or sell of share, bonds etc based on the information that does not have safety for the investment. Speculative trading in the foreign exchange market is the major source of profit for the dealers but average source of profits. The most of the profits for dealers in foreign exchange trading is market making activities vs. speculation. 2) Is the U.S Current Account Deficit Excessive? Introduction Current account deficit occurs when a nations total exports such as goods, services and transfers is less than nations total imports such as goods, services and transfers. This makes a nation a debtor to the rest of world. However current account deficit is balanced by the capital account surplus. If the capital account does not able to balance the current account then current account deficit leads to balance of payment deficit. A current account deficit is not a problem for certain countries. In order to increase the productivity and export in future some developing countries may run current account deficit for short period of time. To understand the current account by understanding the private saving, private investment and government budget surplus and deficits. To know current account deficit is good or bad is by checking the source of the deficit that is investment and savings. The United States current deficit expand in forth quarter which reflect an improving economy, but fell at the lowest point in eight years because of imbalance happen in 2009. The deficit will increase in 2010, says economist but not that much what we have seen in before recession. For the year, current account deficit pushed by 40.5 percent i.e. $419.9 billion which is the smallest imbalance since 2001. Last years deficit was 2.9 percent of United States total economy which was the smallest percentage in 11 years. The economists closely watch the figures of current account which not only includes trade in goods and services but also investment flows between countries which are tracked by the government on a monthly basis. These figures indicate how much money a country needs to finance its balance of payment imbalance. Economist predict that weaker dollar will boost United States exports because it make United States goods more competitive in foreign market and imports goods more expensive for United States consumers. United States export rose to 8.8 percent for the fourt h quarter because of improving global economy which boosted the demand for United States Autos, Industrial supplies and farm product in foreign market as well as demand for imports also increased because of rebound in United States economy. Imports rose to 9.2 in forth quarter which led big gain in petroleum, capital goods, autos and consumer goods. The amount of $36.5 billion profit gain in service trade such as transportation, financial and other service was used to offset some of the deficit in goods of $145.5 billion in the 4th quarter. The United States of America had a deficit of $31.8 billion in a sector called as unilateral transfers, this transfer includes things like foreign aid, and on the other hand United States had a $25.1 billion profit on investment flows. The Chinese save very much and Japan saving is also high from past 20 year where as American do not save very much because of this the government of United States run big government deficit where as Japan and China run a large current account surplus. The situation will reverse as soon as the investment demand picks up in these counties and these countries starts investing or buying U.S assets. Conclusion In other words an imbalance in nations current account due to payment made by the country for buying the imports is greater than payment received by the country for selling the exports. However current account deficit is balanced by the capital account surplus. However current account is not good or bad because when a country has a current account deficit it borrows from foreigners. If foreign funds profitably invested then these investments will increase the domestic growth and generate greater returns which help to pay off the foreign debts. 3rd Question Answer as fallows. Dollar dominated pure discount bond is 4.5% Per Annam ($) In France, the Euro rate is 7.5% Per Annam (ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬) The current spot rate = $1.08/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ (S) Forward exchange rate=? Formula to find the forward exchange rate F (n) = S ÃÆ'Æ’- [1+i (n, $)] n [1+i (n, ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬)] n = $1.08/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ ÃÆ'Æ’- (1.045) 5 = $ 0.9375/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ (1.075) 5 So the forward exchange rate for five year is $ 0.9375/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ Now, lets use a different method to fine the result. Let assume, invest $10,000,000 in 5 year dollar dominated pure discount. So, at the end of 5 year, the investment will grow to $ 10,000,000 ÃÆ'Æ’- (1.045)5 = $12461819.38 At the current spot exchange rate, the Euro cost of $ 10,000,000 is = $ 10,000,000/ $1.08/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ = ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ 9259259.26 If invest ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ 9259259.26 in one year dollar dominated discount bond, at the end of the year will have =ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ 9259259.26 ÃÆ'Æ’- (1.075)5 = 13292864.13 Now, F(5) = $ 12461819.38/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ 13292864.13 = $ 0.9375/ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬ Question 4 Ans 180-day Swiss franc deposit: 8.0% P.A. 180-day euro deposits: 10.0% P.A. Spot exchange rate: EUR 1.1960/CHF. 180-day forward exchange rate: EUR 1.2024/CHF. If Carla Heinz invested in euro denominate @ 10% Per Annum. she will have after six months of investment. EUR invest = (euro 10,000,000 X .01) 180 / 360 + Euro 10,000,000 EUR invest = 500,000+10,000,000 = Euro 10,500,000 Next, lets calculate the euro return if Carla Heinz invests her Euro 10,000,000 in Swiss francs denominated assets. This analysis requires three steps: Step 1. Convert the euro principal into Swiss francs in the spot foreign exchange market. The Euro 10,000,000 will buy at the current spot exchange rate this is Carla Heinz principal. Euro 10,000,000 = CHF 8361204 Euro 1.1960 Step 2. Calculate Swiss francs denominated interest plus principal. Carla can invest her Swiss francs principal at @ 8% for one year. Hence, Carla Heinz know that in a six month she will have a return of Swis s francs principal plus interest equal to (CHF 8,361,204 X 0.08)  ½ + CHF 8,361,204 = CHF 8,695,652.26 Step 3. In this case Carla Heinz would contract to sell CHF 8,695,652.26 for Euro at the six month forward rate of Euro 1.2024/CHF. In a six month she would receive. CHF 8,695,652.26 X (Euro 1.2024/CHF) = Euro 10455652 = Euro 10,455,652 Euro 10,500,000 Note: After analyzing the investment of Carla in Euro and Swiss francs its seems that investing in Euro denominated is better compare to Swiss francs and she even dont have a risk of forward exchange rate. But know Carla has an option to barrow money from Swiss and invested in Euro denominated. III) On other hand if Carle Heinz can borrow money CHF 10,000,000 and invested in Euro dominated assists what she will get. For half year she will owe (CHF 10,000,000 X 0.08)  ½ CHF 10,000,000 =CHF 1,040,000 IV) So if Carle Heinz invests in Swiss franc denominate assists then Step 1. Convert from CHF to Euro. CHF 10,000,000 X (Euro 1.1960/CHF) = Euro 11,960,000 Step 2. Calculate Euro interest rate (Euro 11,960,00 X 0.1)  ½ + Euro 1,196,000 = Euro 1,255,800 Step 3. Cove the foreign exchange risk by engaging forward contract to sell. Euro 1, 255,800 Euro 1.2024/CHF = CHF 1,044,411 = CHF 1,044,411 CHF 1,040,000 = CHF 4411. Note: After analyzing the investment of Carla in Euro by browning Swiss francs it seems that investing in Euro denominated is good even after covering forward exchange risk. Ms Carla Heinz will receive CFH 411 in a six month for every CHF 10,000,000. Question 5 Ans Spot exchange rate: CHF 1.4706/$. 180-day forward exchange rate: CHF 1.4295/$. 180-day dollar interest rate: 7.0 % P.A. 180-day Swiss francs interest rate: ? The formula to find forward premium the Swiss francs inertest rate is F S S 1_____ 1_____ F S = CHF 1.4295/$ CHF 1.4706/$ = 2.88 % S 1_____ CHF 1.4295/$ Note that the interest rate differential (dollar Swiss francs) is 7.0% 2.88% = 4.12%, which is approximately equal to the forward premium. The Swiss francs forward interest rate i.e. 4.12% which prevent arbitrage. Question 6 Ans Probability of Argentina will nationalize its banks is = 0.5% ( p ) The interest rate in United States =5 % ( i ) What Argentine banks offer inter rate? p = 0.05, i = 0.005. Formula to find out expected return to the depositing bank is [(1-p) x (1+i)] + (px0) = (1-p) x 91+i) (1-P) ÃÆ'Æ’- (1-i) = 5% = (1-0.005) ÃÆ'Æ’- (1-i) = 0.05 (1+i) = 0.05 = 0.0503 x 100 to convert in to percentage = 5.03% 0.995 Note: the Argentine banks have to offer 5.03% interest in order to attract deposits from foreign investors. Question 7 Intel is a US company, and it is scheduled to receive yen in the future. A weakening of the yen versus the dollar causes a given amount of yen to convert to fewer dollars in the future. This loss of value could be severe if the yen depreciates by a significant amount. If Intel chooses not to hedge its transaction exchange risk, what is Intels expected dollar value of the 100,000,000 the expected spot rate incorporates a 1% weakening of the dollar. This means that the expected yen price of the dollar is 1% less than the current spot rate of 103/$ OR Et(S (t+90,/$) ) = 0.99103/$ = 101.97/$ Hence, Intel expects to receive 100,000,000/101.97/$ = $980,681 We are told that the standard deviation of the rate of depreciation of the dollar is 4%. The standard deviation of the future spot rate is therefore 4% of the current spot rate of 1.04103/$=4.12/$. Thus, plus or minus 2 standard deviations around the conditional expected future spot rate is 101.97/$ + 8.24/$ = 110.21/ $ 101.97/$ 8.24/$ = 93.73/$ the range that encompasses 95.45% of https://www.businessweek.com/ap/financialnews/D9EH4M901.htm