Suppose a producer or N-95 Respirator Masks exports some of its product up to Canada. It expects its invoice of C$18,000,000 for its export to Canada to be paid in 90-days. The current spot and the 90-day forward rates are $0.7502/$C1 and $0.7422/$C1 respectively.

Calculate the company's Canadian dollar transaction exposure associated with this fee.

If the spot rate in 90-days is $0.7489, what is the expected U.S. dollar value of the invoice?

What are the types of hedges and the value to this invoice?

Answer rating: 100% (QA)

To calculate the companys Canadian dollar transaction exposure we need to determine the potential gain or loss in Canadian dollars due to fluctuations ... View the full answer