U.S. interest rate for 1 year (borrow or deposit)

11%

Swiss deposit rate for 1 year (borrow or deposit)

9%

Swiss forward rate for 1 vear

$.40 or SF2.50: $1

Swiss franc spot rate

$.39 or SF2.56: $1

Also assume that a U.S. exporter expects to receive SF600,000 in 1 year.

Using the information above, what will be the approximate value of these exports in 1 year in U.S. dollars given that the firm executes a money market hedge?

a) $240,000

b) $1,500,000

c) $238,294

d) $1,536,000