Business
Business, 16.03.2020 21:10, queenb1416

Jetta production cost in 2002 and 2003 was 12,000 Euro per Jetta. Jettas were sold in US at $13,000 in 2002 and 2003. Forward hedge exchange rate was 1 $/Euro in 2003. The market exchange rate was 1.15 $/Euro (i. e. rate without hedge) in 2003. If 9,000 Jetta were sold in US, in 2003, by 60% forward hedge and 40% not hedged. What would be profits or loss from sales of 9,000 Jetta in US?

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Jetta production cost in 2002 and 2003 was 12,000 Euro per Jetta. Jettas were sold in US at $13,000...

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