Financial Economic Case Study Example | Topics and Well Written Essays - 250 words

Financial Economic - Case Study Example C) The choice getting 10000Kr in this coming September could resolve the exchange rate issue. In case of the other option to get paid in September and February have equal chances of gain and loss. So I will get the money in September and will keep that till the end of First so that I can get the 4% interest from the US bank. I will repeat the same for the following year. So for the first year I will get 1040$ and the next year it depends on the exchange rate. In case if the exchange rate increases say, 12Kr/$. I can convert the dollars to Sweden Kr. So that if I can put that amount in bank and I can get interest from the Sweden Bank. And If exchange rate found to decrease say 10Kr/$ then I will convert the Kr to dollars. The only risk in this type is in case after converting the dollars to Kr if the exchange rate Kr/$ does not decrease that could be a loss. But thinking in terms of interest from the Sweden bank could compensate the loss.