You are the vice-president of finance for Exploratory Resources, headquartered in Calgary. In January 2012, your firms American subsidiary obtained a six-month loan of $2.0 million (U.S.) from a bank in Calgary to finance the acquisition of an oil-producing property in Oklahoma. The loan will also be repaid in U.S. dollars. At the time of the loan, the spot exchange rate was US$1.0135/C$ and the U.S. currency was selling at a premium in the forward market. The June 2012 futures contract (face value = $200,000 per contract) was quoted at US$1.0117.

b. How much is the bank expected to gain due to foreign exchange risk? (Round the intermediate calculation to 4 decimal places.)

Bank expected to gain $ Canadian