申論題

1. You are a U.S. investor who is trying to calculate the present value of £5 million cash inflow that will occur one year in the future. The spot exchange rate is S0 = $1.8839/£ and the forward rate is F1 = $1.8862/£. The appropriate dollar discount rate for this cash flow is 5.00% and the appropriate £ discount rate is 4.00%.

(2)What is the present value of the £5 million cash inflow computed by first converting into dollars and then discounting? (5 points)