The company has received an offer to supply 1,000 widgets at the cost of $1,000...
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The company has received an offer to supply 1,000 widgets at the cost of $1,000 each (total order value - $1 million). This will make the fiscal year one of the best ever (as well as provide you with a large bonus). Unfortunately, the purchaser wants to pay in Euros in 6 months, thereby creating a foreign exchange risk for the company.
Identify the spot and 6-month forward exchange rates for the two currencies.
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