Institute of Chartered Financial Analysts of India (ICFAI) University 2006 Certification Finance International and Trade – II - Question Paper

30
44
6.25
1.375
–
47.2019
6.4903

36
44
6.50
1.430
–
47.5498
6.7996

42
44
6.40
1.408
–
47.9003
6.7444

48
44
6.25
1.375
–
48.2534
6.6348

54
44
6.50
1.430
–
48.6091
6.9511

60
–
6.50
1.430
44
48.9674
222.4589


Effective cost of the loan in rupee term is provided by ‘r’ in the subsequent formula.

200.11 = 6.5545 PVIF (r/2, 1) + 6.3996 PVIF (r/2, 2) + 6.6003 PVIF (r/2, 3) + 6.7005 PVIF (r/2, 4) + 6.4903 PVIF (r/2, 5) + 6.7996 PVIF (r/2, 6) + 6.7444 PVIF (r/2, 7), 6.6348 PVIF (r/2, 8) + 6.9511 PVIF (r/2, 9) + 222.4589 PVIF (r/2, 10)

For r/2 = 3% R. H. S. = 217.2616

For r/2 = 4% R. H. S. = 199.6650

\ = =

= three + 0.9747 = 3.9747%

\ r = 7.95%

a. ii. Spot Rate Rs./ € 58.43/58.47

Middle rate = 58.45

Forward
six month
Rs./ €
58.45 ´
=
59.3181


12 month
Rs./ €
59.3181 ´
=
60.1990


18 month
Rs./ €
60.1990 ´
=
61.0931


24 month
Rs./ €
61.0931 ´
=
62.0003


30 month
Rs./ €
62.0003 ´
=
62.9212


36 month
Rs./ €
62.9212 ´
=
63.8557


42 month
Rs./ €
63.8557 ´
=
64.8040


48 month
Rs./ €
64.8040 ´
=
65.7665


54 month
Rs./ €
65.7665 ´
=
66.7432


60 month
Rs./ €
66.7432 ´
=
67.7344






Month
Principal (€ Million)
Interest rate (%)
Interest payment (€ Million)
Principal repayment (€ Million)
Exchange rate

(Rs./ €)
Total repayment (Rs. in crores)

0
35
–
–
–
58.43
(204.505)

6
35
5.50
0.9625
–
59.3181
5.7094

12
35
5.50
0.9625
–
60.1990
5.7942

18
35
5.75
1.00625
–
61.0931
6.1475

24
35
6.00
1.0500
–
62.0003
6.5100

30
35
5.85
1.02375
–
62.9212
6.4416

36
35
5.60
0.9800
–
63.8557
6.2579

42
35
5.50
0.9625
–
64.8040

Earning:   Approval pending.