- Bobcat, a U.S.-based manufacturer of industrial equipment, just purchased a Korean company that produces...
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- Bobcat, a U.S.-based manufacturer of industrial equipment, just purchased a Korean company that produces plastic nuts and bolts for heavy equipment. The purchase price was Won 7,800 million. Won1,500 million has already been paid, and the remaining Won6,300 million is due in six months. The current spot rate is Won 1,071.95/$, and the 6-month forward rate is Won 1,103.28/$. - A 6-month call option on won with a Won 1,100/$ strike rate has a 2.83% premium, while the 6 -month put option at the same strike rate has a 2.48% premium. - Bobcat's weighted average cost of capital is 9%. - Compare alternate ways that Bobcat might deal with its foreign exchange exposure. What do you recommend and why
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