U.S. dollars to buy Indian rupees on March 27. ey would therefore enter into a short futures contract to sell the
U.S. dollars and buy Indian rupees using the USD–INR futures contract.
Solution to Problem 9.2
Since each contract size is USD 1,000, Ram Textiles will take a short position in 500 USD(INR contracts with expiry
on March 27. Ram textiles will receive 48.6532 × 500,000 = INR 24,326,600 on March 27, irrespective of the spot rate
of exchange on that date.
Raj Mohan has sons working in the USA, and each month his son Prem sends USD 2,000 to Raj Mohan. On
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