Cost if hedged Cost if not hedged

Receipts if not hedged receipts if hedged

Show your work. Round rates to the nearest basis point (0.01%) and amounts to the nearest dollar 1. Money Corp. frequently uses a forward hedge to hedge its Malaysian ringgit (MYR) receivables. For the next month, Money has identified its net exposure to the ringgit as being MYR1,500,000. The 30-day forward rate is S.23. Furthermore, Money's financial center has indicated that the possible values of the Malaysian ringgit at the end of next month are $.20 and S.25, with probabilities of .30 and .70, respectively. Based on this information, what is the expected real cost of hedging receivables? (5 points)