Question

Vixor Co. is a U.S. firm conducting a financial plan for the next year. It has no foreign subsidiaries, but more than half of its sales are from exports. Its foreign cash inflows to be received from exporting and cash outflows to be paid for imported supplies over the next year are shown in the following table:

Currency	Total Inflow	Total Outflow
Candian Dollar (C$	C$40,000,000	C$10,000,000
New Zealand Dollar (NZ$)	NZ$5,000,000	NZ$1,000,000
Mexican Peso (MXP)	MXP11,000,000	MXP5,000,000
Singapore Dollar (S$)	S$4,000,000	S$8,000,000

The spot rates and one-year forward rates as of today are shown below:

Currency	Spot Rate	One-Year Forward Rate
C$	$.70	$.73
NZ$	$ .60	$.59
MXP	$.04	$.03
S$	$.69	$.68

1. 
   Based on the information provided, determine Vixor’s net exposure to each foreign currency in dollars.

Answer 1

Solution:-

If you have any query related to question then feel free to ask me in a comment. Thanks. Please rate.