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Find what is the expected loss from the forward hedging

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Question 1: HP sold a super computer to the AN University in Netherlands on credit and invoiced €30 million payable in six months. Currently, the six-month forward exchange rate is $1.35/€ and the foreign exchange advisor for HP predicts that the spot rate is likely to be $1.20/€ in six months. What is the expected gain/loss from the forward hedging?

Select one:

Option a. $4,500,000 - Loss

Option b. $36,000,000 - Gain

Option c. $36,000,000 - Loss

Option d. $4,500,000 - Gain

Reference no: EM132574342

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