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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

  1. 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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