Also Assume That a U

Multiple Choice

$$\begin{array} { l l r } \text { U.S. deposit rate for 1 year } & = & 11 \% \\\text { U.S. borrowing rate for 1 year } & = & 12 \% \\\text { New Zealand deposit rate for 1 year } & = & 8 \% \\\text { New Zealand borrowing rate for 1 year } & = & 10 \% \\\text { New Zealand dollar forward rate for 1 year } & = & \$ .40 \\\text { New Zealand dollar spot rate } & = & \$ .39\end{array}$$
Also assume that a U.S. exporter denominates its New Zealand exports in NZ$ and expects to receive NZ$600,000 in 1 year. You are a consultant for this firm.
Using the information above, what will be the approximate value of these exports in 1 year in U.S. dollars given that the firm executes a money market hedge?

A) $238,584.
B) $240,000.
C) $234,000.
D) $236,127.