Stardust, Inc., is an exporter of plumbing fixtures. About 30 percent of its sales are made in

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Stardust, Inc., is an exporter of plumbing fixtures. About 30 percent of its sales are made in Canada. The sales department just found out that the Canadian dollar is at a premium against the U.S. dollar based on the 90-day forward rate, while the 180-day forward rate indicates that the Canadian dollar is at a forward discount. What is the likely impact of these rates on the company’s sales to Canada?

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Fundamentals of corporate finance

ISBN: 978-0470876442

2nd Edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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