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Suppose PepsiCo hedges a 1 billion dividend it expects to receive from its Japanese subsidiary in 90 days with a forward contract. The current
Suppose PepsiCo hedges a 1 billion dividend it expects to receive from its Japanese subsidiary in 90 days with a forward contract. The current spot rate is 150/$1 and the 90 day forward rate is 149/$1. If the spot rate in 90 days is 154/$, how much has this forward market hedge cost PepsiCo?
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International Financial Management
Authors: Cheol S. Eun, Bruce G.Resnick
6th Edition
71316973, 978-0071316972, 78034655, 978-0078034657
