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(10 points) (Ch. 10) Transaction Exposure. Chicago Export Corp. is a U.S. firm that exports most of its products to Canada. It historically invoiced its

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(10 points) (Ch. 10) Transaction Exposure. Chicago Export Corp. is a U.S. firm that exports most of its products to Canada. It historically invoiced its products in CAD to accommodate the importers. However, it was adversely affected when the CAD weakened against the U.S. dollar. Since Chicago Export Corp. did not hedge, its CAD receivables were converted into a relatively small amount of USD. After a few more years of continual concern about possible exchange rate movements, Chicago called its customers and requested that they pay for future orders in USD instead of CAD. At this time, the Canadian dollar was valued at 0.82 in CADUSD. The customers decided to oblige since the number of CAD to be converted into USD when importing the goods from Chicago was still slightly smaller than the number of CAD that would be needed to buy the product from a Canadian manufacturer. Based on this situation, has transaction exposure changed for Chicago Export Corp.? (5 points) Has economic exposure changed? (5 points) Explain

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