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QUESTION 1 20 points Save Answer On January 1, 2022 Xerox Corporation signs a contract with Japanese government to suppl
Posted: Sun Jul 03, 2022 6:57 am
by answerhappygod
- Question 1 20 Points Save Answer On January 1 2022 Xerox Corporation Signs A Contract With Japanese Government To Suppl 1 (20.6 KiB) Viewed 12 times
QUESTION 1 20 points Save Answer On January 1, 2022 Xerox Corporation signs a contract with Japanese government to supply office machinery. The contract stipulates that Xerox will receive 500,000 Yen on January 1, 2023. Xerox wishes to insure itself against exchange rate risk. The yield on a one year US Treasury bill on January 1, 2022 is 5.73% and the yield on a one year Japanese Treasury bond is 1.17%. The spot exchange rate on the same date is 110 Yen per US dollar. Suppose that Xerox uses the forward market to insure itself against exchange rate risk. Compute the amount of dollars that Xerox will receive for sure.