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FIN 534 Week 11 Quiz 10
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Finance 534 week 11 quiz 10
Question 1
Suppose DeGraw Corporation, a U.S. exporter, sold a solar
heating station to a Japanese customer at a price of 143.5 million yen,
when the exchange rate was 140 yen per dollar. In order to close the
sale, DeGraw agreed to make the bill payable in yen, thus agreeing to
take some exchange rate risk for the transaction. The terms were net 6
months. If the yen fell against the dollar such that one dollar would buy
154.4 yen when the invoice was paid, what dollar amount would
DeGraw actually receive after it exchanged yen for U.S. dollars?
Question 2