Describe how these three typical transactions should affect present and future exchange rates:
a. The Pennsylvania Liquor Control Board (PLCB)—an independent government agency that manages the beverage alcohol industry in Pennsylvania—imports a year’s supply of French champagne. Payment in euros is due immediately.
b. AT&T sells a new stock issue to Orange S.A., the French telecommunications company. Payment in dollars is due immediately.
c. Korean Airlines buys five Dreamliner Boeing 787s. 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.
