Maria is a U.S. investor who expects to receive €1,000,000 in six months from a European investment. To lock in the exchange rate and mitigate currency risk, she decides to enter into a currency forward contract. The forward exchange rate for euros to U.S. dollars is currently 1.20. This means that for every euro, she can exchange it for $1.20.
What will be the total amount in U.S. dollars that Maria will receive when she exchanges her €1,000,000 at the forward rate?