Question
Assume that Parker Co. will receive SF200,000 in 360 days. Assume the following interest rates: U.S. Switzerland 360-day borrowing rate 6% 4% 360-day deposit rate
- Assume that Parker Co. will receive SF200,000 in 360 days. Assume the following interest rates:
| U.S. | Switzerland | |
| 360-day borrowing rate | 6% | 4% |
| 360-day deposit rate | 5% | 3% |
Assume the forward rate of the Swiss franc is $.50 and the spot rate of the Swiss franc is $.48. If Parker Co. uses a money market hedge, how much $ will it receive in 360 days?
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The Dark Side Of Valuation
Authors: Aswath Damodaran
3rd Edition
0134854101, 9780134854106
