East Bay Business Daily

Diagram 4 Example of overall capital loss with a forex loss

Summary: disposes of the right when its value is US$110 and the exchange rate has moved unfavourably to 1 25 or US$0 80 The outcome is depicted in the following diagram Diagram 4 If the capital loss amount on the event is expressed by the formula Capital loss = FC2 x ER2 FC1 x ER1 = US$110 x 1 25 US$100 x 1 67

Image Dimensions: 556 x 348