Question

IBM purchased computer chips from NEC, a Japanese electronics concern, and was billed ¥250 million payable...

IBM purchased computer chips from NEC, a Japanese electronics concern, and was billed ¥250 million payable in three months. Two companies agree to share the currency risks. In the Price Adjustment Clause, the neutral zone is ¥113.38/$ - ¥127.42/$, the base rate is ¥120.4/$ and both parties will share the currency risk beyond a neutral zone. How much each party have to pay/receive if:

a) Exchange rate is ¥117.21/$

b) Exchange rate is ¥109.42/$

c) Exchange rate is ¥130.12/€

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Ford purchased electric motors from Nidec (Japanese company) and was billed ¥200 million payable in three...
Ford purchased electric motors from Nidec (Japanese company) and was billed ¥200 million payable in three months. Two companies agree to share the currency risks. In the Price Adjustment Clause, the neutral zone is ¥115.38/$ - ¥129.42/$, the base rate is ¥122.4/$ and both parties will share the currency risk beyond a neutral zone. How much each party have to pay/receive if the exchange rate is ¥117.21/$s How much each party have to pay/receive if the exchange rate is ¥132.12/$...
Ford purchased electric motors from Nidec (Japanese company) and was billed ¥200 million payable in three...
Ford purchased electric motors from Nidec (Japanese company) and was billed ¥200 million payable in three months. Two companies agree to share the currency risks. In the Price Adjustment Clause, the neutral zone is ¥115.38/$ - ¥129.42/$, the base rate is ¥122.4/$ and both parties will share the currency risk beyond a neutral zone. How much each party have to pay/receive if the exchange rate is ¥111.42/$? a. Ford pays ¥200 million; Nidec receives $1.634 million. b. Ford pays $1.634...
Suppose that Boeing (US company) sold airplane to Lufthansa (German company) on credit and invoiced €20...
Suppose that Boeing (US company) sold airplane to Lufthansa (German company) on credit and invoiced €20 million payable in six months. Two companies agree to share the currency risks. In the Price Adjustment Clause, the neutral zone is $1.14/€ - $1.26/€, the base rate is $1.2/€; and both parties will share the currency risk beyond a neutral zone. How much each party have to pay/receive if: How much each party have to pay/receive if the exchange rate is $1.08/€ a....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT