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months from today. KAL currently has excess cash of 30,000,000,000 Korean won (KRW) in a Seoul bank, and it is from these funds that KAL
months from today. KAL currently has excess cash of 30,000,000,000 Korean won (KRW) in a Seoul bank, and it is from these funds that KAL plans to make its next payment borrow in Korea at 6.625%, and can probably borrow in the U.S. dollar market at 9.250% a. How much in Korean won will KAL pay in 90 days without a hedge if the spot rate in 90 days is the same as the expected spot rate of KRW798 = USD1.00? b. How much in Korean won will KAL pay in 90 days with a forward market hedge? c. How much in Korean won will KAL pay in 90 days with a money market hedge? d. How much in Korean won will KAL pay in 90 days with an option hedge if the expected spot rate in 90 days is assumed to be greater than KRW796 = USD1.00? e. How should KAL plan to make the payment to Boeing if KAL's goal is to maximize the amount of won cash left in the bank at the end of the three-month period
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