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Question 12 of 21: FarmCo sells 50 tractors to Kyoto Grove in Kyoto, Japan, for 200 million Japanese yen. At the time of sale, the
Question 12 of 21: FarmCo sells 50 tractors to Kyoto Grove in Kyoto, Japan, for 200 million Japanese yen. At the time of sale, the exchange rate is 100 yen to 1 US dollar. Why would FarmCo utilize a forward contract? Select an answer: FarmCo will receive 2 million dollars when it deposits the check, plus any additional gain from a more favorable exchange rate FarmCo is taking a risk that looking forward the exchange rate will be more favorable than when it made the sale to Kyoto Grove Regardless of the exchange rate when Kyoto Grove pays. FarmCo will receive 2 million dollars from the bank when it deposits the check
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