Calculate the price of the shipment in cad

Reference no: EM133377303

Question: Arthur Itis owns a business in Ontario, but 90 percent of his business is exporting medicine to the United States. He has a contract with an American company to sell USD $500,000 worth of product. Delivery is in sixty days. Arthur knows the CAD is at $0.92 today, but is expected to drop to $0.89 in sixty days.

a) Calculate the price of the shipment in CAD if the American company paid today when it ordered.

b) Calculate the price of the shipment in CAD if the American company pays on delivery in sixty days.

c) What is it called when the value of a currency goes down?

d) When should Arthur ask for the payment? How much more does he make if he receives the highest possible payment?

e) Why would Arthur quote his price in USD?

f) What are the risks of quoting in USD?

Reference no: EM133377303

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