Machine Buy - Forward Date | Dollar बढ़ा तो नुकसान? Future Payment in USD? | Embedded Derivative

Let’s take a situation… We have a contract to buy a machine It’s a non-financial item Delivery is after 3 months We entered into a contract with a UAE-based company Machine price = $X (in USD) Now tell me — what’s the problem? Think about it. Today, dollar has a price. What if the dollar increases to ₹130? Simple question: Will we have a loss or profit? Will we feel happy or sad? Answer: If the dollar increases We pay more in ₹ → Loss → We feel sad If the dollar decreases We pay less in ₹ → Gain → We feel happy So what’s happening here? Something in this contract is making us: Sad when the dollar rises Happy when the dollar falls That “something” is called: Foreign Exchange Risk #ForexRisk #ForeignExchangeRisk #CurrencyRisk #ExchangeRate #USDINR #FinancialManagement #CAInter #CAStudents #FinanceConcepts #ConceptClarity #LearnFinance #CommerceStudents #StudySmart #ExamPrep