If you buy GBP 2,000,000 against USD at 1.6020; GSP 1,000,000 at 1.6035 and GBP 3,000,000 at 1.6028, what is the average rate of your position?
A) 1.6035
B) 1.6027
C) 1.6030
D) 1.6023

Question

Quizplus · Accepted Answer

We need to calculate the weighted average rate for the position:

(2,000,000 x 1.6020) + (1,000,000 x 1.6035) + (3,000,000 x 1.6028) = 10,814,600

Total amount = 2,000,000 + 1,000,000 + 3,000,000 = 6,000,000

Weighted average rate = 10,814,600/6,000,000 = 1.8024333

Rounding off to 4 decimal places, we get:

Weighted average rate = 1.6027

Therefore, the best choice is B.

If You Buy GBP 2,000,000 Against USD at 1