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hi Question 1: Assume that an American exporter will receive 250,000 CHF in the next 60 days, and this exporter want to convert that amount
hi
Question 1: Assume that an American exporter will receive 250,000 CHF in the next 60 days, and this exporter want to convert that amount (CHF) to USD. As known, Spot rate: CHF/USD 0.6922 Future spot rate: CHF/USD=0.6785. a. Identify the risk that the exporter has to face in this situation? b. Should this exporter use the forward contract (60 days) at CHF/USD 0.6856 to hedge or not? WhyStep by Step Solution
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