Problem 8.7 Consider a US-based company that exports goods to Switzerland. The US.company expects to receive payment on a shipment of goods in three months. Because the payment will be in Swiss francs, the U.S. company wants to hedge against a decline in the value of the Swiss franc over the next three months. The US risk-free rate is 5 percent and the Swiss risk-free rate is 8 percent. Assume that interest rates are expected to remain fixed over the next six months. The current spot rate is $0.5989 a. Whether the U.S.company should use a long or short forward contract to hedge currency risk. O Long position in forward contract Short position in forward contract b. Calculate the no-arbitrage price at which the U.S. company could enter into a forward contract that expires in three months. (Do not round intermediate calculations. Round your answer to 4 decimal places.) No arbitrage price c. It is now 30 days since the US company entered into the forward contract. The spot rate is $0.43. Interest rates are the same as before Calculate the value of the U.S. company's forward position (Negative amounts should be shown with a minus sign. Do not round Intermediate calculations, Round your answer to 4 decimal places.) Forward position Shon