COUNTRY-CURRENCY CONTRACT $/FOREIGN CURRENCY Canada—dollar Spot .8437 30-day .84

Question

COUNTRY-CURRENCY CONTRACT $/FOREIGN CURRENCY
Canada—dollar Spot .8437
30-day .8417
90-day .8395
Japan—yen Spot .004684
30-day .004717
90-day .004781
Switzerland—franc Spot .5139
30-day .5169
90-day .5315

(Spot exchange rates) An American business needs to pay (a) 10,000 Canadian dollars, (b) 2 million yen, and (c) 50,000 Swiss francs to businesses abroad. What are the dollar payments to the respective countries?



(Spot exchange rates) An American business pays $10,000, $15,000, and $20,000 to suppliers in, respectively, Japan, Switzerland, and Canada. How much, in local currencies, do the suppliers receive?

Explanation / Answer

The following are the amounts, in local currencies, received by the suppliers 10,000 ($) x 1/0.004684 (Yen/$) = 2134927.41 Yen 15,000($) x 1/0.5139 (Swiss franc/$) = 29188.55 franc 20,000 ($) x 1/0.8437 (Canadian dollar/$) =23705.10 Canadian dollar

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