A European Wheat Exporter entered into a contract on 25 March 2020 with an Indian Four Mill to supply 5 shipments of wheat at USD 150,000 each.
The Wheat Exporter entered into contracts with farmers in Europe to supply them the same quantity of wheat at EUR 125,000 each at the same time.
The shipments were to commence on 10th April and the 10th of every alternate month, with the last shipment on 10th December.
The Flour Mill agreed to pay the Wheat Exporter in 20 days from shipment date. The Wheat Exporter agreed to pay the farmers 30 days from shipment date
EUR/USD spot exchange rates and forward points were as follows
Date	Spot Rate		Forward Period	Forward Points
25-Mar-20	1.0890		1 month	10
30-Apr-20	1.0824		3 months	25
30-May-20	1.1119		5 months	41
30-Jun-20	1.1247		7 months	57
30-Jul-20	1.1872		9 months	73
30-Aug-20	1.1939	Notes: Forward rate is calculated by adding forward points to the spot rate by converting them to ten thousandths (i.e. divide by 10,000)
30-Sep-20	1.1726
30-Oct-20	1.1679
30-Nov-20	1.1938
30-Dec-20	1.2300
30-Jan-21	1.2124
Calculate the following
A) The amount of EUR and the profit margin that the Wheat Exporter expected to receive at EUR/USD spot rate on the date of the contract
B) The amount of EUR and the profit margin that the Wheat Exporter would have received assuming they converted USD to EUR at spot rates on receipt
C) The amount of EUR and the profit margin that the Wheat Exporter would have received had they bought EUR/USD using fx forward contracts
D) What Curreny risk hedge should the Wheat Exporter have used to protect their profit margin? Explain why show calcultion in excel please with formula s s

D 1 Assumptions G H 2 A European Wheat Exporter entered into a contract on 25 March 2020 with an Indian Four Mill to supply 5 shipments of wheat at USD 150,000 each, 3 The Wheat Exporter entered into contracts with farmers in Europe to supply them the same quantity of wheat at EUR 125,000 each at the same time. 4 The shipments were to commence on 10th April and the 10th of every alternate month, with the last shipment on 10th December 5 The Flour Mill agreed to pay the Wheat Exporter in 20 days from shipment date. The Wheat Exporter agreed to pay the farmers 30 days from shipment date 6 7 EUR/USD spot exchange rates and forward points were as follows Forward Forward Date Spot Rate Period Points 9 25-Mar-20 1.0890 1 month 10 10 30-Apr 20 1.0824 3 months 25 11 30 May 20 1.1119 5 months 41 12 30-Jun-20 1.1247 7 months 57 13 30-Jul-20 1.1872 9 months 73 14 30-Aug-20 1.1939 15 Notes: 30-Sep-20 1.1726 Forward rate is calculated by adding forward points to the spot rate by converting them to ten 16 30-Oct-20 1.1629 thousandths (le divide by 10.000) 17 30-Nov-20 1.1938 18 30-Dec-20 1.2300 19 30 Jan 21 1.2124 Test 20 21 Calculate the following 22 A) The amount of EUR and the profit margin that the Wheat Exporter expected to receive at EUR/USD spot rate on the date of the contract 23 B) The amount of EUR and the profit margin that the Wheat Exporter would have received assuming they converted USD to EUR at spot rates on receipt 24 C) The amount of EUR and the profit margin that the Wheat Exporter would have received had they bought EUR/USD using ix forward contracts 25 D) What Curreny risk hedge should the Wheat Exporter have used to protect their profit margin? Explain why 26 D 1 Assumptions G H 2 A European Wheat Exporter entered into a contract on 25 March 2020 with an Indian Four Mill to supply 5 shipments of wheat at USD 150,000 each, 3 The Wheat Exporter entered into contracts with farmers in Europe to supply them the same quantity of wheat at EUR 125,000 each at the same time. 4 The shipments were to commence on 10th April and the 10th of every alternate month, with the last shipment on 10th December 5 The Flour Mill agreed to pay the Wheat Exporter in 20 days from shipment date. The Wheat Exporter agreed to pay the farmers 30 days from shipment date 6 7 EUR/USD spot exchange rates and forward points were as follows Forward Forward Date Spot Rate Period Points 9 25-Mar-20 1.0890 1 month 10 10 30-Apr 20 1.0824 3 months 25 11 30 May 20 1.1119 5 months 41 12 30-Jun-20 1.1247 7 months 57 13 30-Jul-20 1.1872 9 months 73 14 30-Aug-20 1.1939 15 Notes: 30-Sep-20 1.1726 Forward rate is calculated by adding forward points to the spot rate by converting them to ten 16 30-Oct-20 1.1629 thousandths (le divide by 10.000) 17 30-Nov-20 1.1938 18 30-Dec-20 1.2300 19 30 Jan 21 1.2124 Test 20 21 Calculate the following 22 A) The amount of EUR and the profit margin that the Wheat Exporter expected to receive at EUR/USD spot rate on the date of the contract 23 B) The amount of EUR and the profit margin that the Wheat Exporter would have received assuming they converted USD to EUR at spot rates on receipt 24 C) The amount of EUR and the profit margin that the Wheat Exporter would have received had they bought EUR/USD using ix forward contracts 25 D) What Curreny risk hedge should the Wheat Exporter have used to protect their profit margin? Explain why 26