Problem:
You are the vice president of a Salmon farming operation in Oregon. Two weeks ago, you received a 5 million Canadian Dollar loan from a bank in Yellow Knife for a new facility in their city. You deposited the loan proceeds in an Oregon bank at the exchange rate of $ 1.10 US per 1 Canadian dollar. Six months from now you will need to pay your Yellow Knife contractor; your staff economist forecasts the exchange rate will be the US Dollar will be worth 0.97 Canadian Dollars. Will you have enough money to pay the contractor? How much are you over/short?