On January 2 of a particular year, an American firm decided to close out its account at

Question:

On January 2 of a particular year, an American firm decided to close out its account at a Canadian bank on February 28. The firm is expected to have 5 million Canadian dollars in the account at the time of the withdrawal. It would convert the funds to U.S. dollars and transfer them to a New York bank. The relevant spot foreign was $0.7564. The March Canadian dollar futures contract was priced at $0.7541. Determine the outcome of a futures hedge if on February 28 the spot rate was $0.7207 and the futures rate was $0.7220. All prices are in U.S. dollars per Canadian dollar. The Canadian dollar futures contract covers CD 100,000?
Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...