Ch 4 · International Financial Management

🧮 Formula sheet

1. 1.Forward Rate = Spot × (1 + ih × t/360) / (1 + if × t/360)
2. 2.Money Market Hedge: Borrow foreign, convert spot, invest home
3. 3.NPV (foreign project) = Σ [FCFt × FXt] / (1 + r_home)ᵗ
4. 4.Cross Rate: USD/EUR × INR/USD = INR/EUR