Question

A U.S. Örm sells merchandise today to a British company for £ 75,000. The current exchange rate is $1.55/£ , the account is payable in three months, and the Örm chooses to avoid any hedging techniques designed to reduce or eliminate the risk of changes in the exchange rate. If the exchange rate changes to $1.58/£ the U.S. Örm will realize a ________ of ________.

Answer 1

Answer: Loss of $2250

Step-by-step explanation:

At the time of payment the dollar has lost $0.03 to pounds in value which total $2250 on 75000 pounds conversion to $.