Question
Heavy Artillery plc is a designer and manufacturer of custom motorcycle parts from their base in rural Derbyshire. The companys main US customer has recently
Heavy Artillery plc is a designer and manufacturer of custom motorcycle parts from their base in rural Derbyshire. The companys main US customer has recently suggested that they will be prepared to pay a premium of 2% if Heavy Artillery will accept payment in USD rather than GBP.
You are given the following information
- Value of order 100,000
- US interest rate 6%
- UK interest rate 2%
- Payment terms 60 days
- Todays spot rate is 1.550
- In 60 days the spot rate is 1.500, what is the implication for Heavy Artillery under the terms of the forward contract?
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The Millionaire Next Door The Surprising Secrets Of Americas Wealthy
Authors: Thomas J. Stanley, William D. Danko
1st Edition
1589795474, 978-1589795471
