Explore BrainMass
Share

Foreign Exchange Question

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

A US Importer owes a Belgian Company ? 500,000 payable 30 days from today, expects that the US $ will weaken during this period.
a‐ What would you advise the importer to do?
b‐ What would happen to the profits of the US company if the $ were to strengthen during this period?

Can anyone help with this problem?

© BrainMass Inc. brainmass.com October 25, 2018, 12:08 am ad1c9bdddf
https://brainmass.com/economics/finance/218190

Solution Preview

Hi there,

Here are your answers:

a) I would advise the importer to pay their bill as soon as possible. The longer that they wait to ...

$2.19
See Also This Related BrainMass Solution

You are the treasury department for a multinational firm and have been asked to raise $20 million.

SAMPLE QUESTION 1

You are the treasury department for a multinational firm and have been asked to raise $20 million. Discuss what options are available to raise this money and decide what financial instruments you will use. Which financial instruments will you use to raise the $20 million? What financial intermediaries will you use? What regulatory agencies will you need approvals from to raise the funds? What are the pros and cons of each choice? Have you considered the exchange rate risks?

SAMPLE QUESTION 2

What is meant by foreign exchange risk? What specific problems does foreign exchange present in an organization? How could an organization needing Euros in six months protect itself from currency fluctuations?

SAMPLE QUESTION 3

What is globalization? Why has globalization become such an important issue over the last ten years? How will globalization change financial management in the years ahead?

View Full Posting Details