During COVID-19, following economic relief packages were delivered by different states. Ehsaas Emergency Cash program has been launched by the Prime Minister of Pakistan on April 1, 2020. United States issued $1200 checks to Americans. The UK government committed £30 billion to saving jobs and helping the young find work in an economy ravaged by the corona virus pandemic. Do you find any type of Riba involved in any of these packages? If yes, which one? How? (you can explore the details of these packages).

During COVID-19, following economic relief packages were delivered by different states. Ehsaas Emergency Cash program has been launched by the Prime Minister of Pakistan on April 1, 2020. United States issued $1200 checks to Americans. The UK government committed £30 billion to saving jobs and helping the young find work in an economy ravaged by the corona virus pandemic. Do you find any type of Riba involved in any of these packages? If yes, which one? How? (you can explore the details of these packages).

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter20: Short-term Financing

Section: Chapter Questions

Problem 3BIC

See similar textbooks

Similar questions

The government of Ghana in an attempt to stimulate the Ghanaian economy after the COVID 19 pandemic has set aside 600 million Ghana cedis as a
The COVID-19 pandemic is over, and you decide to celebrate by going on a vacation to Japan. The following quotes are provided by a Foreign Exchange (FX) dealer at the airport. BUY SELL YEN (Japan) 71 70 b) upon returning from the Japan, you have 75 000 YEN which you wish to convert back to AUD. How much will you receive? Show workings and a concluding statement in your response.
The COVID-19 pandemic is over, and you decide to celebrate by going on a vacation to Japan. The following quotes are provided by a Foreign Exchange (FX) dealer at the airport. BUY SELL YEN (Japan) 71 70 a) If you are exchanging 30 000 AUD (Australian Dollars), how many Japanese YEN will you receive? Show workings and a concluding statement in your response.
The International Monetary Fund, the IMF, has forecasted that the global economy is likely to experience a contraction of 3% in 2020, due to the ravages of the COVID-19 pandemic on both developing and advanced economies. Investors believe that The Deutsche Bundesbank, the central bank of the Federal Republic of Germany, will employ direct foreign intervention strategies in the future, to minimize the economic fallout and increase the volume of exports. Assume the following information: 1 - year U.S. interest rate = 3% 1- year German interest rate = 6% Spot rate of euro = $1.09 Compute the profit and yield to the investor who stands to benefit from covered interest arbitrage.
The International Monetary Fund, the IMF, has forecasted that the global economy is likely to experience a contraction of 3% in 2020, due to the ravages of the COVID-19 pandemic on both developing and advanced economies. Investors believe that The Deutsche Bundesbank, the central bank of the Federal Republic of Germany, will employ direct foreign intervention strategies in the future, to minimize the economic fallout and increase the volume of exports. Assume the following information: 1 - year U.S. interest rate = 3% 1- year German interest rate = 6% Spot rate of euro = $1.09 Draw a diagram to illustrate your understanding of the relationship between interest rate parity and covered interest rate arbitrage and the interplay of market forces that will occur to eliminate arbitrage opportunities.
Today is 1 August and a quick check of the newspaper shows that the relevant exchange rate is AUD 1.00 = EUR 0.6882. Your budget suggests EUR10,000 will be required to guarantee the success of your vacation. Naturally, you fear that the Australian Dollar might weaken between now and December, thus impacting on the quality of your vacation. There are a number of courses of action available to you and we will explore the outcomes of each. a) Assume that you do nothing. In December, the day before your departure, you visit the bank and ask to buy EUR10,000. Assume that the spot exchange rate then is AUD 1.00 = EUR 0.6000. How much will the EUR10,000 cost you?
What is the contribution to the asset base of the following items under the Basel III requirements? $10 million cash reserves. $50 million 91-day U.S. Treasury bills. $25 million cash items in the process of collection. $5 million UK government bonds, OECD CRD rated 1. $5 million French short-term government bonds, OECD CRD rated 2. $1 million general obligation bonds. $40 million repurchase agreements (against U.S. Treasuries). $2 million loan to foreign bank, OECD rated 3. $500 million 1–4 family home mortgages, category 1, loan-to-value ratio 80 percent. $10 million 1–4 family home mortgages, category 2, loan-to-value ratio 95 percent. $5 million 1–4 family home mortgages, 100 days past due. $500 million commercial and industrial loans, AAA rated. $500 million commercial and industrial loans, B- rated. $100,000 performance-related standby letters of credit to a AAA rated corporation. $100,000 performance-related standby letters of credit to a municipality issuing general obligation…
In 2018, the country X received: collected taxes in the amount of 35 million, customs fees amounted to 12 million, non-tax revenues to the budget amounted to 20 million. In the same year, the State purchased the public goods and services in the amount of 38.4 million, public transfers was 14.7 million, the interest on the national debt was payed in quantity of 17.6 million. Determine the state of the budget (in deficit, in balance, in surplus).
Suppose the Bangladesh Bank purchases a government bond from you for TK 10,000. a. Suppose you deposit the TK 10,000 in First Security Bank. Show this transaction on First Security Bank's T-account. 02 b. Suppose the reserve requirement is 20 percent. Show First Security Bank's T-account if they loan out as much as they can. 02 c. At this point, how much money has been created from the Bangladesh Bank’s policy action?
The Muscat City for the year 2019 maintain two funds: a General Fund accounts for its unrestricted resources and general operations, and a Proprietary funds for internal services and State Enterprises. The Muscat City has provided the following financial information for the year 2019 for you to prepare r journal entries in the relevant funds separately. As the crude oil price in the international market has come down from the budgeted 58 $ per barrel to 23$ per barrel, City has decided to borrow 2 million OMR from the world bank – IMF to address the increasing deficit in the budget. The City levied $ 1 million of general property taxes of which it actually collected $ 0.4 million. The City decided to set up its own printing and publishing department by investing OMR 0.8 million but the services will be available only for government units, but not free of cost. City government also transferred 0.80 million as an investment for automation and diversification of the services of Muscat…
Mo. Jeanette Johnson is going to Saudi Arabia next week for Spring break. She inquires about the rate of exchange between the US dollar and the Riyal (the currency of Saudi Arabia). She is then informed by a teller at Bank of America in San Francisco that the bank’s current bid rate is R/$ = 3.7505, while their offer rate is R/$ = 4.0000. Coincidentally, she meets Al Freddy, a friend of hers, who just arrived from Saudi Arabia and who would like to convert his Riyals into dollars at the same Bank. Which of these two rates from Bank of America is applicable to Jeanette Johnson? [Remember: Jeanette who is going to Saudi Arabia has dollars that she wants to exchange against Riyals]. A. bid rate. B. offer rate. C. both the bid and offer rates D. neither the bid nor the offer rate.
Cleveland Company is a U.S. firm with a U.S. dollar functional currency that manufactures copper-related products. It forecasts that it will sell 5,000 feet of copper tubing to one of its largest customers at a price of ¥50,000,000. Although this sale has not been firmly committed, Cleveland expects that the sale will occur in six months on June 30, 2022. Thus, Cleveland is exposed to changes in foreign currency exchange rates. To reduce this exposure, Cleveland enters into a six-month foreign currency exchange forward contract with a third-party dealer on January 1, 2022, to deliver ¥ and receive US$. The foreign exchange contract has the following terms:Contract amount: ¥50,000,000Maturity date: June 30, 2022Forward contract rate: ¥105.00 = US $1.00Yen / US$ Exchange rates: Date Spot rate Forward rate for June 30 January 1 ¥100.00/US $1.00 ¥105.00/US $1.00 March 31 ¥102.00/US $1.00 ¥108.00/US $1.00 June 30 ¥110.00/US $1.00…