Question: Describe how these three typical transactions should affect present and future exchange rates.
a. Seagram imports a year's supply of French champagne. Payment in French francs is due immediately.
b. American Motors sells a new stock issue to Renault, the French car manufacturer. Payment in dollars is due immediately.
c. Korean Airlines buys five Boeing 747s. As part of the deal, Boeing arranges a loan to KAL for the purchase amount from the U.S. Export Import Bank. The loan is to be paid back over the next seven years with a two year grace period.