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4) Suppose that Boeing Corporation exported a Boeing 747 to Lufthansa and billed 10 million payable in one year. The money market interest rates and

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4) Suppose that Boeing Corporation exported a Boeing 747 to Lufthansa and billed 10 million payable in one year. The money market interest rates and foreign exchange rates are given as follows: Assume that Boeing sells a currency forward contract of 10 million for delivery in one year, in exchange for a predetermined amount of U.S. dollars. Suppose that on the maturity date of the forward contract, the spot rate turns out to be $1.40/ (i.e. less than the forward rate of $1.46/). Which of the following is true? A) Boeing would have received $14.6 million, rather than $14.0 million, had it not entered into the forward contract. B) Boeing lost $0.6 million from forward hedging. C) Boeing would have received only $14.0 million, rather than $14.6 million, had it not entered into the forward contract. Additionally, Boeing gained $0.6 million from forward hedging. D) none of the options

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