1. What is the spot rate for the British pound (GBP) on Wednesday in terms of the U.S. dollar (USD)? Or, from the U.S. perspective, what is the direct quote on pounds?)
1GBP = 1.266 USD Wednesday Feb 1, 2017
2. What is the spot price for the USD on Wednesday in terms of the Swiss franc (CHF)? (Or, from the U.S. perspective, what is the indirect rate on Swiss francs?)
1CHF= 1.0069 USD Wednesday Feb 1, 2017
3. Using your answers from #1 and #2 above, calculate the cross rate of exchange between the British pound (GBP) and the Swiss franc (CHF) (need to see your math).
Required exchange rate= (GBP/USD) / (CHF/USD)
= 1.266 / 1.0069
= 1.2573
Therefore, 1 GBP = 1.2573 CHF
4. Calculate the annualized forward premium or discount on six-month forward yen (need to see your math).