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America Company does business in the United States and New Tealand. In attempting to assess is economic exposure, it eompiled the following information. Today's exchange
America Company does business in the United States and New Tealand. In attempting to assess is economic exposure, it eompiled the following information. Today's exchange rate is S_(1)=0.50 (SD) //NZD. a. Kramerica's U.S. sales are somew hat affected by the value of the New Zealand dollar (NZD), because it faces competition from New Zealand exporters. It forecasts the U.S. sales based on the following three exchange rate scenarios: Exchange Rate of NZD Revenue from U.S. Business (in millions) 0.48 USD/NZD USD 100 0.50 (ISD/NZD USD 105 0.54 USD/NZD USD 110 b. Its New Zealand dollar revenues on sales to New Zealand invoiced in New Zealand dollars are expected to be VZD 600 million. c. Its anticipated cost of goods sold
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