Steve Harris, CFO of Alston Concrete Products, is currently evaluating the purchase of an innovative machine that tests the strength of concrete. The machine is manufactured in England. Steve has a price quote of 52,500 GBP (British pounds) that is good for 180 days. He is concerned that the pound may strengthen by as much as 10% against the US dollar during this time frame. Currently the pound is trading for $1.00. If Steve is correct in his forecast, how much could he save if he were to buy pounds now (forward buying) for delivery in 90 days?

Display keyboard shortcuts for Rich Content Editor