A Canadian company is exporting lumber to Japan. The sales agreement calls for a payment of 7,000,000 yen to the Canadian company in 60 days. The current spot rate is 102 yen per dollar. 

a. Is the Canadian company worried that the yen may appreciate or depreciate in value over the next 60 days?

b. If the Canadian company decides to hedge using a forward contract and the 60-day forward rate is 100.5 yen per dollar, how many dollars will it receive in 60 days?

c. By how much is the Canadian company better or worse off if it does not hedge and the spot rate in 60 days is (i) 98 yen per dollar or (ii) 103 yen per dollar?