An U.S. firm requires C$230,000 in 90 days to pay the imports from Canada. To avoid currency exchange rate risk, it needs to __________  A. purchase Canadian dollars (C$) 90 days from now at the spot rate B. obtain a 90-day forward sale contract on Canadian dollars (C$) C. obtain a 90-day forward purchase contract on Canadian dollars (C$) D. sell Canadian dollars (C$) 90 days from now at the spot rate

Q: Spindler, Inc. (a U.S.-based company), imports surfboards from a supplier in Brazil and sells them…

A: Acquired surfboards on September 1, 2020 -300 Surfboards @ BRL 1,600 = BRL 480,000. Exchange rate…

Q: percent per year. a. Determine the notional principals in euros and pounds for a swap with…

A: Information Provided: Semi-Installments = 12,500,000 Current exchange rate = Euro 1.5/pound Fixed…

Q: Pink has just sold equipment to Black. Pink is a US company who has USD accounting. Sale date is…

A: There are variations in exchange rate due to which there are losses and gains on the exchange rate.

Q: Incantieri sold a cruise ship to Disney Cruise Line, a U.S. company, and billed $1 billion payable…

A: Hedging: It is  a risk management strategy  to remove  losses in investments by taking an opposite…

Q: On October 1, 2020, Mertag Company (a U.S.-based company) receives an order from a customer in…

A: Sale of goods to Poland on 01.10.2020 Forward rate $0.29 Spot rate $0.25 As per the information…

Q: At the end of 2020, an Italian subsidiary of a U.S. parent reports €1,000,000 in equipment purchased…

A: Fixed assets should be valued at exchange rate on the date of transaction.

Q: Suppose one-year US Treasury bill pays 2.28% and one-year Canadian Treasury bill pays 0.95%. The…

A: Arbitrage is a process to earn profit by purchasing one security from the market and selling another…

Q: Suppose, Company ABC is U.S. based company and has a British subsidiary. It is expected that the…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: A company based in the United Kingdom has an Italian subsidiary. The subsidiary generates…

A:

Q: 90 Day Forward Rates for Hongkong Dollar Bid Rate Ask Rate USDHKD0.6050.610 A Hongkong exporter…

A: in this you have convert HONGKONG currency to US dollars and that will be amount to be received.

Q: it on simple interest to the European Union (EU). The prevailing interest rates gazetted from UK…

A: A money market is a strategy for locking in the price of a different currency in the native currency…

Q: Nicantieri sold a cruise ship to MCC Cruise Line, a U.S. company, and billed $1 billion payable in…

A: One currency can be exchanged for another currency using the currency exchange rates. To hedge the…

Q: Jackson, a U.S. company, acquires a variety of raw materials from foreign vendors with amounts…

A:

Q: New York Co. has agreed to pay 9 million Australian dollars (A$) in two years for equipment that it…

A: The term exchange rate refers to the rate at which the currency of one country in exchange for…

Q: A currency trader observes that in the spot exchange market, 1.00 U.S. dollar can be exchanged for…

A: Here we have to find the cross exchange rate and we can do so by equating both Mexican pesos and the…

Q: A British company has a USD 1 million payable in two months.How can the British company hedge the…

A: Hedging means techniques or procedures used to eliminate or reduce the risk exposure to due to…

Q: Al-Huda Corporation is an Omani firm offering different services. However, its main activity focuses…

A: The transaction exposure is the level of uncertainties faced by entities due to volatile foreign…

Q: Incantieri sold a cruise ship to Disney Cruise Line, a U.S. company, and billed $1 billion payable…

A: As per our guidelines, we are supposed to answer only 3 sub-parts (if there are multiple sub-parts…

Q: On October 1, 2020, Mertag Company (a U.S.-based company) receives an order from a customer in…

A: Spot Rate is the cash rate that gives the immediate value of the product being transacted between…

Q: On August 1, Pure Joy Corporation (a U.S.-based importer) placed an order to purchase merchandise…

A: please like the answer your response matters…

Q: Johnson & Johnson, Inc., a U.S.-based MNC, will need 15 million Brazilian Reals on December 1. It is…

A: Non deliverable contracts are basically the type of the currency derivative in which we do not…

Q: Suppose a U.S. firm purchases some Chinese handicrafts. The china costs 1,000 Chinese yuan. At the…

A: Handicrafts cost = 1,000 Chinese yuan  $1.00 = 6.2 yuan

Q: Alice Inc. imports manufactured goods from Ireland to the U.S. Alice’s revenues are primarily in…

A: alice inc expose to currency risk with expenses in Euros considering engaging in option contract…

Q: Brandt Corp. (a U.S.-based company) sold parts to a South Korean customer on December 1, 2020, with…

A: The transactions which involve exchange rate mechanism can be hedged by using the various derivative…

Q: On October 1, 2020, Mertag Company (a U.S.-based company) receives an order from a customer in…

A: Since the forward exchange rate is utilized to measure the reasonable estimation of the firm…

Q: On March 1, Laton Products (a U.S. firm) purchased manu-facturing inputs from a Mexican supplier for…

A: Currency exchange: Currency exchange is a business that has got legal right to exchange their…

Q: Currently, the spot exchange rate is CHF 0.89/$ and the three-month forward exchange rate is CHF…

A: Interest rate parity refers to the no-arbitrage condition in which the interest rates available to…

Q: JJ Fashion Wholesalers Ltd, an Indian clothing manufacturer, has a contract to purchase cotton from…

A:

Q: e on a currency swap in euros is 4 percent, and the fixed rate on a currency swap in Canadian…

A: Information Provided: Cash flows = 10 million Exchange rate = Canadian dollar 0.825/ Euro Fixed rate…

Q: On June 1, Vandervelde Corporation (a U.S.-based manufacturing firm) received an order to sell goods…

A: a)

Q: Cleveland Company is a U.S. firm with a U.S. dollar functional currency that manufactures…

A: Journal entries are the primary reporting of transactions in the accounting books.

Q: ABC Co. expects a payment from an American customer in 30 days. To hedge its currency exposure, ABC…

A: Solution:- Forward means entering into an agreement to sell or buy something on a future date at…

Q: A British money financier is managing €10 million and wants to invest it in safe bonds either in…

A: Investment means engaging your funds to generate income in the future. Invest the money in different…

Q: Date Spot Rate Forward Rate (to January 31, 2021) October 1, 2020 $ 0.25

A: Since the forward exchange rate is utilized to measure the reasonable estimation of the firm…

Q: An Italian exporter exported sports apparel worth €300,000 to the UK, where the exchange rate is…

A: Billed amount = €300,000 Amount received = €270,000

Q: An australian company, X, currently exports bulk of its production to a Malaysian company under a…

A: In finance, the risk is the probability that actual results will differ from expected results. In…

Q: The spot foreign exchange rate for the US dollar is 0.69056 Euros. Your company agrees to pay a bank…

A: Current spot rate= $1=0.69056

Q: Emily Karlsen is a currency trader in Sydney and has 1 million Australian dollar (or the U.S. dollar…

A: Forward rate in terms of units of foreign currency per unit of home currency With spot exchange rate…

Q: If a U.S. firm desires to avoid the risk from exchange rate fluctuations, and it will need C$200,000…

A: The foreign exchange risk alludes to damage incurred by currency fluctuations in a global financial…

Q: (a) A merchant in the UK has agreed to sell goods to an importer in the USA at an invoice price of…

A: Data given: Particulars Amount ($) On shipment $40,000 1 month after shipment $60,000 3…

International Bonds

A bond is fixed-income security where a lender comes into a contract with the borrower. The borrower agrees to make payment and interest at a specified date in the future or on maturity period. It is a type of financing that helps to fulfill and meet obligations. Many people invest in bonds because it is a simple form of security.