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Today US based MNC is selling its product to one company in Germany with the payment of euro 2 million in 90 days. Today's sport

  1. Today US based MNC is selling its product to one company in Germany with the payment of euro 2 million in 90 days. Today's sport rate is $1.30/euro.

  • What is a risk factor of US based MNC?
  • If 90 day forward rate in euro is $1.34/euro, how the US MNC avoids the FX rate risk?
  • Does the US MNC have a forward gain or loss?

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