Canon needs to cover its expenses in japan

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Reference no: EM139101

Q. On January 2d, 2012, Canon expects to ship 750,000 all-in-one fax, printers, and copy machines from its plant in Japan to the US, which it will sell through US dealers on 240-day terms at $95 each. So Canon will receive payment from its dealers on August 28th, 2012. Assuming which Canon needs to cover its expenses in Japan and thus wants to hedge its Yen/US$ exposure using a forward contract with a Japanese bank in the US, Illustrate what is the minimum amount of Yen they should receive on August 28th, 2012 given the eight month forward rate for one US dollar in terms of Yen which you calculated in problem one? Illustrate what are two other ways Canon might hedge their Yen/US$ exposure?

Reference no: EM139101

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