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7.5 Suppose that the exchange rate is .60 dollars per swiss franc. if the franc appreciates 10% against the dollar, how many francs would a dollar buy tomorrow?

7.6 Suppose the exchange rate between U.S dollars and the Swiss franc is SFr1.6 = $1 and the exchange rate between the dollar and the British pound is 1 = $1.50. What then is the cross rate between francs and pounds?

7.7 Assume that interest rate parity holds. In both the spot market and the 90-day forward market, 1 japanese yen 0.0086 dollar. In Japan, 90-day risk-free securities yield 4.6%. What is the yield on 90-day risk-free securities in the United States?

7.8 In the spot market, 7.8 pesos can be exchanged for 1 U.S dollar. A Pair of headphones costs $15 in the United States. If purchasing power parity holds, what should be the price of the same headphones in Mexico?

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