Suppose a client receives quotes of $0.009369/\ - $0.009373/\ for the Japanese yen and $0.03675/NT$ - $0.03679/NT$ for the Taiwan dollar. Bid Ask $/ 0.009369 0.009373 $/NT$ 0.03675 0.03679 a. How many U.S. dollars will the client receive from the sale of 50,000,000. b. What is the NT$ cost to the client of buying $500,000. c. What is the cross bid-ask rate of WINT$? d. How many yen will the client receive for the sale of NT$200,000,000.

a. US dollars from sale of 50,000,000 yen.

1 yen = $ 0.009369 [Bid]

50,000,000 yen = 0.009369 * 50,000,000

50,000,000 yen = $468,450

Therefore, the client will receive $468,450 from sale of 50,000,000 yen

b. NT dollars for buying $500,000

1 NT$ = $ 0.03679 [Ask]

1$ = 1/0.03679 NT$

1$ = 27.1813 NT$

$ 500,000 = 27.1813 * 500,000

$ 500,000 = 13,590,650 NT$

Therefore, it will cost 13,590,650 NT$ to the client to buy $500,000

c. Cross bid-ask rate yen/NT$

Bid

1 yen = $0.009373

1$ = 1/ 0.009373 yen

1 NT$ = $ 0.03675

1 NT$ =  [0.03675 * (1/ 0.009373)] yen

1 NT$ =  [0.03675 / 0.009373] yen

1 NT$ = 3.9208 yen

Ask

1 yen = $0.009369

1$ = 1/ 0.009369 yen

1 NT$ = $ 0.03679

1 NT$ =  [0.03679 * (1/ 0.009369)] yen

1 NT$ =  [0.03679 / 0.009369] yen

1 NT$ = 3.9268 yen

Hence,

d. Yen from sale of 200,000,000 NT$

1 NT$ = 3.9208 yen [Bid]

200,000,000 NT$ = 3.9208 * 200,000,000

200,000,000 NT$ = 784,160,000 yen

Therefore, the client will receive 784,160,000 yen from sale of 200,000,000 NT$