3.On October 1, IJR International received an order from a Japanese customer for 2,500,000 Yen tobe paid upon receipt of the goods, scheduled for December 1. The rates for $1 US are as follows:Spot rate, October 1Forward rate, December 1Spot rate, December 1Exchange Rates for $1 for Yen838281(a) Calculate what IJR would receive from the Japanese customer in US dollars using the spot rateat the time of the order.(b) Calculate what IJR would receive from the Japanese customer in US dollars using the spot rateat the time of payment.(c) Calculate the amount that IJR expects to receive on December 1 if IJR's policy is to hedge foreigncurrency transactions.(d) How can IJR protect itself from the risk of the transaction?

A supplier will be paid in foreign currency (JPY) at the fulfillment of the order. The question…

Answered: On October 1, IJR International…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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