Question: Firm AAA, located in the U.S., has a payable obligation of 500 million payable in one year to a bank in Japan. The current spot

Firm AAA, located in the U.S., has a payable obligation of 500 million payable in one year to a bank in Japan. The current spot rate = 110/$, the one year forward rate = 125/$. The future dollar cost of meeting this obligation using the forward contract hedge is:

		Insufficient information
		$4,187,911
		$4,000,000
		$4,545,454

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