Transactionexposure.

International Products has contracted for 7,000 winter hats from Russia. The contract price is 1,300 rubles per hat. The current direct exchange rate is 0.03291.

The expected inflation rate for the next 3 months is 5.6% in the United States and 1.9% in Russia. If International Products will pay for the hats at delivery and scheduled delivery is 3 months away, what is the cost of the hats in U.S. dollars? Did waiting the 3 months to pay increase or decrease the payment (in U.S. dollars)? If so, by how much?

If International Products will pay for the hats at delivery and scheduled delivery is 3 months away, what is the cost of the hats in U.S. dollars?

$(Round to the nearest cent.)Did waiting the 3 months to pay increase or decrease the payment (in U.S. dollars)? If so, by how much?

(Select the best response.)

A. Waiting the 3 months to pay increases the payment by $2,682.26.

B. Waiting the 3 months to pay decreases the payment by $2,682.26.

C. Waiting the 3 months to pay does not change the amount of payment.

D. Waiting the 3 months to pay decreases the payment by $2,467.68.

E. Waiting the 3 months to pay increases the payment by $2,467.68.