Calculate the net exchange rate

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In January, a U.S. company expects to pay 75 million Japanese Yen at the end of March. One contract is for 12.5 million yen. The April futures price for the yen is currently 0.9200 cents per yen.

a) What is the hedging strategy?

b) At the end of March, the spot price is 0.8950 and the April futures price is 0.9100. Calculate the net exchange rate.

Reference no: EM131947819

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