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Suppose that Salem Co, a U.S.-based MNC that both purchases supplies from Canada and selis exports in Canada, is seeking to measure the economic exposure

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Suppose that Salem Co, a U.S.-based MNC that both purchases supplies from Canada and selis exports in Canada, is seeking to measure the economic exposure of its cash flows. Salem wishes to analyze how its cash flows might change under different exchange rates for the Canadian dollar (the only foreign currency in which it deals). Salem believes that the value of the Canadian dollar will be $0.75,$0.80, or $0.85, and secks to analyze its cash flows under each of these scenarios. The following table shows Salem's cash flows under each of these exchange rates. Use the table to answer the question that follows. For higher Canadian dollar exchange rates, Salem's cash flows in U.5. dollars

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