For the following order from razon

Reference no: EM131042710

Order from Razon:

Order from Zug:
b. Order from Zug is $1,840,000 as just calculated. The expected cost of offsetting the hedged cash flows is $100,000 as explained next. Brooks sold A$1 million forward. It will purchase them in the spot market and then will fulfill its forward contract. The expected future spot rate in 1 year is $.46, so it would be expected to pay $.46 and sell A$ at the forward rate of $.47 for a $.01 profit per unit. For A$10 million, the profit is $.01 × 10 million = $100,000

(An alternative method would be to apply the $.47 to Zug for A$4 million, which would leave a net of A$6 million to fulfill on the forward contract. The answer will be the same for either method.)

Reference no: EM131042710

Questions Cloud

Described at least two solutions to the identified problem : Discussed a process for implementation of these strategies including information related to the roles of various members of the organizational team including administration, nursing and any other related aspects of the organization.

Write program that that displays jframe window with buttons : Write a program that that displays a JFrame window with 5 buttons. The buttons will be used to control the background color. The button's text will be randomly chosen from 5 colors and the background color will change to the color shown on the button

Discuss your plans for influencing key project stakeholders : Analyze how well your personal leadership style developed in week 1 and your communication style uncovered in week 4 may work with other nationalities, particularly when it comes to motivating team members. Propose adjustments as needed.

Will the two-tier wage structure go away in the near future : Summarizing the Pressures. Will the two-tier wage structure go away in the near future? Summarize the pressures to eliminate it as well as the pressures to keep it. Be sure to consider labor costs and productivity of workers and plants at other compa..

For the following order from razon : b. Order from Zug is $1,840,000 as just calculated. The expected cost of offsetting the hedged cash flows is $100,000 as explained next. Brooks sold A$1 million forward. It will purchase them in the spot market and then will fulfill its forward co..

Why was the civil war significant and revolutionary : Why was the Civil War significant and Revolutionary? Respond in essay format and do not go over 2 pages in 12 Times New Roman double spaced font.

What role did women play in the civil war : What Role did women play in the Civil War? Incorporate Louisa May Alcott's "Hospital sketches" and "The Civil War Remembered pages 82-101 when applicable.

Basic concept of the reconstruction era : Tips will be given for a successful 2-page answer in essay format that uses the reading to explain the reconstruction era. Please also include an introduction explaining the basic concept of the reconstruction era.

What did you learn about leadership and about yourself : Reflect on the activities in this course. What did you learn about leadership and about yourself?

User Account

All Pages