A U. S. firm sells merchandise today to a British company for pound150,000. The current exchange rate is $1.55/pound , the account is payable in three months, and the firm chooses to avoid any hedging techniques designed to reduce or eliminate the risk of changes in the exchange rate. If the exchange rate changes to $1.52/pound the U. S. firm will realize a of .

Gain; $4,500

Loss; $4,500

None of the above

The U.S firm made a loss of $4,500

Explanation:

In order to determine weather the U.S made a loss let us assume payment was made when the exchange rate was $1.55/pound and calculate the amount, and also calculate the amount when exchange rate is $1.52/pound.

cost of merchandise pound150,000.

        ,

the firm would get $232,500

the firm would get $228,000

Hence the U.S firm made a loss of $4,500

answer; niosh, the national institute for occupational safety and health;

answer///the stewardship worldview;