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Hi there, I have a problem set from International Financial Management here, please help me....

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Accounting

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Hi there, I have a problem set from International Financial Management here, please help me. Thanks!

Problem set: 1. You are trying to decide how to hedge euro 5,000,000 accounts receivable due in one year. Current interest rates and exchange rates are Spot rate 1-year forward rate: 1-year interest rates $1.25/ euro $1.19/ euro interest rate: 2.20% per annum $ interest rate: 2.00% per annum Call option: $1.20 strike, premium S0.025/ Put option: $1.20 strike, premium S0.0125/ Note: Please answer the short questions in addition to completing the table a. If you are unhedged, what is your A/R payment in USD given different future spot rates? Complete the table below. In general, what is the accounts receivable in dollars if unhedged. Future Spot Rate 1.10 1.15 1.20 1.25 1.30 A/R proceeds in USD

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