Youre the treasurer of Warm Wear Inc., which imports wool sweaters from around the world. Kreploc, a

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You’re the treasurer of Warm Wear Inc., which imports wool sweaters from around the world. Kreploc, a company in the country of Slobodia, has a product your marketing department would like to carry, and doesn’t require payment until 90 days after delivery. Unfortunately the Slobodian blivit tends to vary in value by as much as 30% over periods as short as three months. This makes you reluctant to do business with Kreploc because of exchange rate risk. The marketing department can’t understand why you have any concerns at all. Prepare a brief explanation, including an illustration, of why you’re concerned.

Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...
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