Homework: Chapter 10 Spring 2022 Homework Question 2, Problem 10-4 (algorithmic) Part 1 of 7 HW Score: 0%, 0 of 15 points O Points: 0 of 3 Save P&G India, Procter and Gamble's affiliate in India, P&G India, procures much of its toiletries product line from a Japanese company, Because of the shortage of working capital in India, payment terms by Indian importers are typically 180 days or longer. P&G India wishes to hedge an 8.8 million Japanese yen payable. Although options are not available on the Indian rupee (Rs) forward rates are available against the yen Additionally, a common practice in India is for companies like P&G India to work with a currency agent who will, in this case, lock in the current spot exchange rate in exchange for a 5 22% fee. Using the exchange rate and interest rate data in the popup window, compare alternate ways below that P&G India might deal with its foreign exchange exposure. Assume a 360-day financial year a. How much in Indian rupees will P&G India pay in 180 days without a hedge if the expected spot rate in 180 days is assumed to be 12.51947/Rs? V2.4097/Rs? V2.5619/RS? b. How much in Indian rupees will P&G India pay in 180 days with a forward market hedge? c. How much in Indian rupees will P&G India pay in 180 days with a money market hedge? d. How much in Indian rupees will P&G India pay in 180 days with a currency agent hedge? e. What do you recommend? Data table Spot rate 2.51947/Rs 180-day forward rate 12.4097/Rs Expected spot, 180 days 2.5619/Rs 180-day Indian rupee investing rate 8.44% 180-day Japanese yen investing rate 3.18% Currency agent's exchange rate fee 5.22% P&G India's cost of capital 12.08% Click on the icon located on the top-right corner of the data table in order to copy its contents into a spreadsheet Print Done