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Course: International Finance A UK-based firm is negotiating terms of a contract valued at 25,000. The UK firm is considering the options of a cash

Course: International Finance

  1. A UK-based firm is negotiating terms of a contract valued at 25,000. The UK firm is considering the options of a cash on delivery (COD) deal or a 90-day credit period. The COD option would include a 7.5% discount on the transaction value. If credit is extended no discount will be offered. Additionally, the following rates are now available

Currency rate 0.9125/$

Currency rate 1.2055/$

90-day forward rate 1.2225/

Firm WACC 12.40% p.a.

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