Cray Research (a U.S firm) purchased a super computer from the Max Planck Institute in Germany on credit and invoiced 10 ,000,000 payable in six months. Currently, the six-month forward exchange rate is $1.247/ and the foreign exchange advisor for Cray Research predicts that the spot rate is likely to be $1.288/ in six months.

(a) What is the expected gain/loss from the forward hedging? (measured in $, and round your answer to zero decimal, e.g., $56,699). When you enter a positive number, it is a profit. If you enter a negative number, it means a loss.