Question
The Import House placed an order today for one million Thai baht of furniture from Thailand. The furniture will be delivered and paid for one
The Import House placed an order today for one million Thai baht of furniture from Thailand. The furniture will be delivered and paid for one year from today. The spot price of the baht is 44.15. The annual inflation rate in Canada is 3% while the inflation rate in Thailand is 10%. The Import House elects to accept all of the exchange rate risk. How much should The Import House expect to pay for the shipment of furniture when it arrives?
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