Forward market evaluation, Financial Management

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Forward market evaluation

Net receipt in 1 month = 240000 - 140000 = $100000

Nedwen Co requires to sell dollars at an exchange rate of 1.7829 + 0.003 = $1.7832 per £

Sterling value of net receipt = 100000/ 1.7832 = $56079

Receipt in 3 months = $300000

Nedwen Co requires to sell dollars at an exchange rate of 1.7846 + 0.004 = $1.7850 per £

Sterling value of receipt in 3 months = 300000/ 1.7850 = $168067


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